does a subwoofer kill stereo sound?

Some will tell you it will degrade the purity of the stereo image. Others will tell you how it can open up the sound. I'm with the later camp, if you can get a good blend. I have used two subs, now I use one near a corner all the way to one side. You would never know where the sub is, it integrates completely with the soundfield. Some rooms are not fullrange speaker friendly, in some stand mounts w/sub ultimately work the best.

My own experience is that it's very difficult to integrate a single subwoofer well. Multiple subs are a bit easier to get to integrate, far more effective and potentially less detrimental to imaging - again, this assumes good subs well-integrated. A poorly integrated sub can certainly hurt imaging and resolution. If I wanted more bass and was weighing adding a single sub vs going to full range, I'd look at full range. If I really wanted the depth and performance of great subs well done, I'd look at a multiple sub system like the Swarm system by Audiokinesis, paired off with Duke's speakers. If you're just looking to buy multiple subs I could also recommend used ACI Force XL's as a great alternative if you don't mind that the company is no longer in business. I've only heard AK Swarm subs with his speakers - I'd imagine they might work well with others if you just by the Swarm, but I'd consult with Duke on that. 2-3 small subs like the ACI would go nicely with monitors - again integration is still key, and your room and contents will play a bit roll there.

No. Stereo imaging is not impaired by a sub, provided that you've managed the x-over properly. Even if you screw that up, you're probably okay on the stereo separation front, so long as you're crossing resonably well below 100hz.

Marty

PS As Jax points out, a lot of things go easier with subs when there's more than one to work with.