Suggestions on replacement AV processor...

The answer you will get from most audio/HT buffs is to have separate systems, provided you have the space and budget for both. Some of us like me, however, do not have room in our homes for both. My own priority in building a system was to have really good 2-channel audio, but also enjoy a high quality HT system. (You can look at my system in "Virtual Systems", where is listed under my member name Sdcampbell with the title "High resolution audio/HT system".) After a lot of looking, listening, and thinking about buying the best pre/pro I could afford, I bought the Bryston SP-1 (Bryston also makes Lexicon), which provides a high-quality analog bypass circuit, plus excellent surround processing. I continue to be impressed and pleased with the high quality audio that Bryston has delivered in the SP-1 -- not to mention their 20-year transferrable warranty. I can't say the SP-1 is the best choice for everyone, but if your priorities are on audio quality rather than lots of features, and you are limited to a combined rather than separate audio and HT setup, then the SP-1 ought to be on your short list.

I am primarily a ultra high end two channel guy and my experiences with high end processors has been disappointing. The difference between a Sony SDP-EP9ES and a ultra high end Fosgate or Lexicon is (in my opinion) not worth the expense.

For that reason, I would find a Sony SDP-EP9ES used and spend the remainder of your budget on a great used tube (two channel) preamp. You may be able to swing an Aesthetix Callisto which is my reference.

The Sony is discontinued, several sites pop up at Google with images and specs if you wish to research. These closed out at about $450.00 new in box three months ago, from an original price of about $1200.00 retail.

I think your system will reproduce much better sound everywhere with your budget split the way I suggest. The two channel will leap light years ahead and the surround will be equal or better than if the $4000.00 was dropped on a processor only.

With 4K you could almost afford a used Theta Casa Blanca I with superior dacs in the front. That would do the trick!!!