Integrated or Separates on a budget


I am in the process of upgrading my existing system on a budget. My first purchase were Paradigm Studio 100 v2. I have a Sony cd carousel and an integrated I am replacing. At the very most, I have about $1200 to spend. I plan to buy used. I need to drive 2 sets of speakers. I have heard that getting separates is generally better all around, but I am not sure if it is possible to get quality pieces in my price range. Any suggestions?
blewis1041
Blewis1041, about the NAD, it's my champagne tastes I'm afraid. I always try to stretch to the very best possible sound for the buck. I'm willing to do some hunting for it and put up with some inconvenience in the outcome.

The amp you mention is still very good. I recommended and had installed its precursor, the C370, in my school's computer lab to drive PSB Image speakers for the projection system. The result is great on movies and demos, and better than most any school has a right to expect for music.

I'm ridiculously golden-eared, and the integrateds I named above (and even the Linns) play in another league--but they won't do two speaker pairs easily and the NAD will.
Blewis, do you have room for a separate amp with volume control (e.g., your integrated that you're trying to replace, or the McCormack Micro Line Drive that just sold for $260) to drive your dining room speakers? Then, you could use a spare line-out, like a tape out, from your main preamp or integrated amp. This would give you a much larger selection of pieces to choose from for your upgrade, and you could really concentrate on your hifi goals for your main system. I'm assuming you wouldn't have to be overly picky or spend-y about the quality of amplification and cabling to drive your dining room in-ceiling Polks.
Jayboard- I have the space, but not sure I understand the hookup you're suggesting. Can you be a bit more specific?
Also, any thoughts on the Arcam A90 or A80 (I know the A90 is likely out of my price range, but maybe not new).
I would stay away from seperates in your price range and look around for a used YBA Integre. 50 very sweet high current beautiful quality watts of the best in its' price range. I owned this baby for 7 years, and it delivered the goods until I needed more goods.