Recommendation for a New HT AVR?

I really like my onkyo 906. I use it with a 7.1 sonus faber setup and it sounds great. No problems powering them too earbleeding levels without distorting a bit. As far as hdmi, not only is it convenient to just hook up one wire but the real reason to get it is the new surround sound formats like dolby true hd and dts hd master. The sound is like sacd compared to a cd and most of these use all of the channels in a 7.1 setup.

For the record, there are a plethora of av receivers out there that will "drive" just about any speaker, even full range! The VAST difference here - comparing an av receiver (yes, even the $5k plus ones) to even modest separates, using outboard amplification - is that the separates amp most always stomps all over any amplification in a receiver full of performance compromises! And we’re talking about dynamics differences, power delivery, and so forth - not just the ability to "drive" a speaker to minimalistic dynamic control and current reserve demand!
A good analogy, for anyone who's interested in comparing even a good AV receiver with a modest separates/power amp combo, is this: Yes, your Honda civic can accelerate (eventually) up to 120mph, just like your porche turbo. The difference is that the Porche can do it with about 5x's the snap, power, acceleration, control, and torque!
So when someone tells you their Dodge Viper does 140 mph on the top end - and you're tempted to think that the speedometer on your Ford Tempo goes up to 120 mph, and you think "big deal on spending the extra cash for performance elsewhere - THINK AGAIN! It's no contest really, in terms of appreciable performance.
I always go back to the comparisons I've done with large flagship AV receivers years ago, then compared them with using an outboard 125w/ch power amp in stead of the onboard amps in the receivers. It was absolutely zero contest in terms of performance between the receiver and the amp! The amp most ALWAYS BLOWS AWAY anything the receiver can compare with it!
Make no mistake, you buy a receiver, and you sacrifice where it counts most often, and that's bottom line performance in sound quality...if that sort of thing makes any differece to you. Fer the record...

So, Iplaynaked, if I were to consider going to separates, what would you recommend I look at? I've never really researched them.

Remember, I have B&W speakers: four 805, HTM2 for the center, two SCM for the center surrounds, and an SVS Ultra for the sub. From B&W's website: "Recommended Amplifier Power 50W - 120W into 8Ω on unclipped programme".

You could easily hang on to see if Emotiva releases that UMC-1 for $699 (loaded 7.1 wiht HDMI, EQ, HD video upscaling, and HD audio codecs), then add an amp - either from them or used multi-channel for not much north of $1k, total! This is probably your best bet, even though you'll be spending over $1300 for all of this new. I think it's worth it, as a minimum for quality speakers like you're using. That's my recommmendation for best bang for buck for your setup, potentially, with all the latest processing.
The other route is buying a current av receiver, with otherwise good quality sound (Like the Harmon Kardon AVR354/254, with latest 7.1 everything), and add an amp.
Traditionally, however, separates AV pre's have typically offered a bit better potential sound, if better dynamics, usually. But, I've had good results here with Yamaha and HK receivers, used as pre/pro's from their pre-out's.
Still, for $699, I'd wait to see what you can get with the Emotiva, and wait a few weeks or so.
For the record, in response to your comments on B&W recommending a "minimum" of 50-150 watts amplification, those are just that, minimums. It's a kin to saying you should use a minimum of 87 octane gas in your car. It will perform much better with higher octane!
Especially when you consider that typical modest sensitivity passive speakers (like your 805's at, what 88db?) need all the dynamic help they can get, you should consider separates, running the speakers as "small" on your processor/receiver (which vastly improves dynamic capability of the system), and a good high current amplifier. If you're trying to keep everything near $1k total, you'd be restricted to used multi-channel amps on the market, and limited to what comes up in the $400 range, at best. If you can squeeze more money out, you can get a bit more amp, of course.
For the record - and I've been selling receivers for years - I'd never be spending over $1k for a "receiver", as a stand alone unit, no. Unless was some killer deal I could resell, I'd be looking for a better combo, because I know what the performance appreciation is, looking elsewhere.

You've got allot of good responses here, so I will make just two quick points.

Note: I've sold a number of AV units over the years, and have been in the unique position to do "allot" of AB testing.

Point 1. The B&K receiver in multi chanel is sonically superior to just about any of the commen brand receivers, ie, Onk/Yam/Den/Pio/JVC/etc - at any price - AB test - you will be able to tell. And is equivilent to most upper line receivers, ie Arcam/AZUR/Rotel/Anthem/Sunfire/etc. and for the negative nancy's out there who's neck hairs will raise for this brash statement - here two very good reasons why -A. B&K works directly with Dolby labs and has set the standard for Dolby 5.1/7.1 and THX. The cards in these receivers are "solid state" with "full bandwidth" signal paths and process and pass all multi-channel formats at the highest THX/Dolby standards - ALL other manufacturers - follow their lead - this is simply - the facts. B. B&K arguably uses some of the finest class A output stages in there amplifiers, with "huge" caps - and deliver considerbly more current than most other brands - current controls your speakers - tells the drivers when to go/when to stop. So - arguably, Arcam,B.C.D.E.etc brands may do this part as well, but better?

Point 2. Your B&K is upgradeable - contact B&K at there 800 number and ask - you will find that they can upgrade the software, firmware and hardware of any of there products, and offer upgrade programs well beyond there 5 year warranty period. Try getting a hold of someone in Japan for an upgrade -

Best of luck - Have fun/enjoy

Point 2.