I want to change from 2 channel to HT but what....

I just put together a system for my son using a Proceed AVP2 and a Marantz 5 channel 9000 . Sounds great , the Proceed is extremely intuitive for menus and set-up and the Marantz runs 150 per channel. The total investment buying preowned was about 1700. Check Audioreview.com for users opinions.
Another consideration is the Outlaw separates, great value for the bucks and certainly within financial parameters.
It's a dotcom buy direct company and their service is outstanding.
Good luck and welcome to 5 channel

Why 7.1? You can't get any decent source material in 7.1, so why bother?
Why is Anthem recommended - because it's excellent bang for the buck. So is Sunfire, but it suffers from the successful (large) company = not-in-our-club attitude that prevails here. The sunfire Theater preamp in III configuration with an Anthem MCA-50 should be under $3,000 and a nice set-up. an Anthem MCA-5 or 50 can be had for about $1,000 - I still have my MCA-5 doing rear / center duties in my system, and it's the component that's lasted longest in my system.
If you're reaaly thinking about a receiver buy it used as they drop like rocks - buy someone elses mistake.
I wouldn't bother with HDMI switching either, as the frequencies video works at is bound to be adversly affected by a switching mechanism - be sure to get at least two HDMI inputs though, as very soon you'll need that for the cable and DVD inputs.

If you are looking at used stuff, EAD was top notch stuff as well as CAL but unfortunatelky both companies have closed their doors. The prices have dropped dramatically but the service may be a problem if needed.

Thank you all for your suggestions. I like the comment on the Arcam biamp ability and comment about why I need 7.1 not 5.1. I am leaning toward the Arcam. If I can run a 5.1 system and biamp my speakers with the other two extra chanels until more movies use 7.1 then I think the AVR300 is the amp for me. The reviews on the AVR300 are fantastic. Where did you purchase your AVR300 for $1600.00?

I moved from a 507 to an Anthem AVM20. It cost me 1,700. I paired it with two Citation 7.1 amps (cost of 1,800 for 8 channels of amazing 150 watt power), four channels each. Very satisfied with the move, a big step up in sound. The Anthem has a better upgrade path then most at resonable costs, sometimes FREE (i like that). Plans are in the works for HDMI swithing to be backwards compatible to the AVM20 - of course a chassis modification will me a cost involved. That is the only video switching I'd spend money on, so I'm content to wait. My tv monitor, like most, just has one DVI connection.

I will say the B&K is very user friendly and has THE best remote of them all. The sound certainly is fine but nothing compared to having seperate amplification. I did a work-a-round because I missed the B&K remote so much I purchased an MX-850 off e-bay... an even better remote then the B&K oem version. Highly recommended... I even have it controling $125.00 worth of Lutron Spacer System dimmers in my room now... its the best!

B&K will charge a lot for their upgrades. Anthem won't. The Anthem's processing control over virtually every aspect of the sound is amazing... tweak till you drop, if so inclined. And their customer service is terrific, although I enjoyed that with B&K as well.

At $1,800 +- for the AVM20, $800 +- for an MCA-5II (5 channel) your at 2,600. I know you want 7.1, but after making that move myself adding 2 speakers, I wouldn't do it again. Your room may dictate all those speakers and I thought mine needed it but it was a waste. Better off with 5 idealy matched speakers then 7 in my book. By the way... the Anthem will allow you to automatically switch to your rear speakers for SACD/DVDr for instance and back to a standard configuration for 7.1 movies! How's that for control?? So if really want another 2 channels, those amps are around 500 more.

Just my thoughts.