Help me make sense of this - Midfi system sounding better hifi.

My bad - Onkyo M-506rs is the right model no.

Thanks for all those who posted for me...You guys are a great source of Hifi info!

System synergy is the culprit. You have multiple pieces that are bright sounding (krell and B&W) and both together will make things much worse. Your Onkyo is much warmer sounding than the krell and why did B&W buy Classe? Because Classe produced warm sounding gear which works well with B&W speakers. You also see a lot of McIntosh gear teamed up with B&W speakers for the same reason. 
Try using your Onkyo with your B&W speakers to see if they sound better

First the two speakers have a different sound and you may have determined that the less expensive one’s sound you favor. Another possibility is the rooms are different in configuration and the one in which you have the preferred speaker works better and therefore is producing the better sound and lastly synergy between components is extremely important and within the preferred system the synergy is just spot on. Experiment by swapping things around but in the end my feeling is you prefer one speakers voiced sound better than the other. In that case sell the less liked speaker and replace it with one that is designed more similar to the one you prefer.

802 speakers want a lot of current to perform well and can present a difficult load for some amplifiers.  I tried several amplifiers with my 802s and finally found one that will deliver the current required. 

You can easily tell when the amplifier is not providing enough current to drive the speakers properly.  Use a piece of music you're familiar with that has a lot of instruments with passages where the music has a series of crescendos. 

An example would be the Andre Previn version of "Rhapsody in Blue."  What you will notice is the sound stage collapse and the crescendos becoming less and less dynamic.  The power supply cannot provide the current needed in the output section of the amplifier to sustain the repeated demands of the music.

I'm not familiar with the Krell amplifier you have so I cannot make any judgment on its ability to drive the 802s.  The amplifier I use has completely separate amplifiers and power supplies for each channel in single chassis.  In this configuration, a channel cannot rob the other channel of the current needed to sustain the musical demands.

The 802s are very good speakers and will provide accurate and dynamic music reproduction once paired with an amplifier capable of meeting the current demands and Ohm loads presented by the speakers.