Musicians in your living room vs. you in the recording hall?

For me, it all depends on the mood which in turn drives the content at that time. And in both cases, unfortunately I can tell the compromises that are made by the quality of my system and the room. 

That's right viridian. In most modern electrified concerts there is not any imaging. But in smaller venues there may be like a jazz club, a choir in a church or a symphony orchestra will have wonderful imaging and loads of ambiance. A string quartet in a hall, imaging and ambiance to spare and a good recording will capture all of that and that is what I want to hear. 
If you do not go to these events you should. Close your eyes and listen to each instrument individually. That is what you are shooting for, the sensation that you are there at that time in that space.

Neither really. All I want is to hear the recordings as accurately as possible. I dont consider my system a substitute for live music. If I want to hear musicians in the flesh I leave my listening room and go out.

     I agree with geoffkait that there's not a big difference between being transported to the venue and the musicians seeming to be playing in your room.  I believe the difference is subtle and based on small clues picked up on the recording mics that a high quality playback system is able to reproduce accurately, such as the decay times of musical notes and reflections off of venue room boundaries, that our brains process as clues to the venues dimensions and sonic characteristics.  
     If there's an absence of venue clues on the recording, I believe our brains process the given sonic information and creates a sound stage illusion that the musicians are playing in our rooms, instead.
     It should be noted that well recorded, mixed and engineered recordings, along with a high quality audio playback system, are both required for our brains to be able to create either sound stage illusion.  Good room acoustics and proper positioning of the main speakers, in relation to the designated listening position, are also critical in enabling our brains to create a solid and stable sound stage illusion.
     Lastly, poorly engineered recordings will only allow our brains to create two dimensional and flat sound stage illusions that are not nearly as involving, realistic or palpable as the three dimensional varieties of sound stage illusions.
     I actually consider the perception of a 3-D, solid, stable and palpable sound stage illusion as a primary goal of my system and the primary contributing factor to my enjoyment of my system.  It's a very immersive experience that significantly adds to my enjoyment of listening to well recorded music in my room.
     For a maximum 3D sound stage illusion effect in my room and system, I move my Magnepan 2.7QR panels between 5-7 feet away from my front wall with zero toe-in and move my listening seat exactly between them and between 3-4 feet away.  This typically provides a wide and deep 3D sound stage illusion with solid, stable and palpable illusions of the instruments and musicians distinctly located within this soundstage. 
      I've also found that my Audio Kinesis 4-sub Swarm type DBA system also significantly enhances the realism of this sound stage illusion.  The bass instruments like drums and upright basses are not only distinctly located within the sound stage but, when I focus on either, I'm able to perceive the varying pitch and volume level of each instrument emanating from the proper sound stage locations.  I consider this level of detail astounding and very enjoyable.  Achieving this level of detail usually requires a well recorded 24/96 hi-res FLAC file recorded direct to digital but it's truly impressive and enjoyable.


Tim