"Personaly, I find the effect of surround minimal at best and not worthy of a large investment. "
Have you ever listened to a quality system, set up properly? One requirement might be a processer that decodes DTS, another would be one with the rear speakers at least 6 or 8 feet behind
the viewing area (where you are sitting!). After that, room layout and acoustics are as important as in two-channel audio.
"In fact some of the highest cost sourround equipment I have has the miss fortune to listen to is quite awful by Hi-Fi audiphile standards."
There is some bad stuff out there, but mostly it is set up poorly. While setting up a room for home theatre is completely different than setting one up for two-channel listening, a good home theatre system should (and some do) faithfully reproduce vocals, instruments, complex passages, etc. just like a quality two-channel system would.
"I have a fairly good Nakamichi 5.1 receiver only because it is needed to recreate the center "dialog" channel to restore proper balance between dialog and sound effects. "
Does it decode DTS encoded DVD's? These DVD's (of course, the well-recorded ones), with the uncompromised audio signal sent directly (via coax or optical out of a quality DVD player) to a quality A/V processor, allow for really intriguing audio. Shortly after installing a really pretty inexpensive system in a friend's house he said he was quite surprised he could hear the sound made as a guy walked past a girl and brushed against her sweater. Intricate detail, as well as "sudden impact" is
possible with a good surround system.
"Don't even bother to use rear speakers as their effect is minimal."
You will barely notice properly set-up surround speakers. However, you would notice their contribution if they were turned off halfway through a well done action movie - properly placed they will put you in the middle of the action, without them all the action is in front of you and you are not really involved.
"I have a very good 12 inch subwoofer but almost never use it as it detracts from the overall balance and sonic quality of the main speakers."
For two channel, or movies? A good subwoofer (M&K, Velodyne) should be quick and musical. There are few that fit this category, but they are available for not that much money. If you have towers, the sub might be only for impact during an action movie - if you have bookshelves a good sub is indispensable. [With your good towers, yes, I don't see how you could integrate it seemlessly.]
"My main speakers are a 10 plus year old Infinity tower design and while not my favorite Hi-Fi speakers they do work well on the side of the tv."
Those are great speakers, but do you have a center channel? It should match your towers (somehow, somewhat, in quality, and midrange size) and is more important than the L+R speakers because it does more than half of the total work. A phantom center will never cut it, even though we know pinpoint soundstaging is possible with good two-channel audio.
"A really GOOD amp does let them produce a pretty good amount of bass without any sub woofer thumping to intrude on the music"
A good sub should almost never thump. As stated before, it should be quick and musical - for action movies it should rumble when called upon, but in a controlled way that makes you feel part of the movie rather than calling attention to itself (just like the rear surrounds). For movies, you could/should possibly set the crossover frequency on the sub pretty low, maybe as low as 50 Hz, so it only adds ambiance but allows your towers to handle the greatest percentage of bass reproduction.
"I found it interesting that when recently visiting an old friend, who is a senior scientist for a well known government lab, and has a good ear for sound, he felt pretty much the same as I do. He expressed dissapointment that he had purchased a Yamaha surround receiver and Yamaha sub woofer and sattelite speakers for their master bedroom (VERY LARGE)."
Yamaha A/V receiver, potentially very good.
Almost any Yamaha speaker - very not faithful
musically or vocally.
"He and his wife both thought the sound was awful, so did I. I am sending him an older Nakamichi surround receiver (for the center channel) and some JBL III studio monitor speakers. "
I have never heard a good JBL speaker, they all have too much bass and too much treble - none are anywhere near accurate.
HOWEVER, I have never heard any of the studio monitor series JBL's and they could be very much better.
Here is a link to a post of mine, where I list some high-end manufacturers
who also make lower priced ($2000 for a system that can faithfully reproduce music) speakers.
Your equipment might be a step in the right direction. Just in my opinion, and this is only one of several possible options
, to have a chance of hearing what is possible with surround sound he could try the following:
A sonically good DVD player - The Oppo DV-970HD gets good reviews ($149)
An Outlaw Audio 1070 A/V receiver
The Mirage OmniSat speaker system
with 10" subwoofer ($2,000)
The Gallo D'Avia Ti speaker system
(includes 10" subwoofer) ($1975)
Of course, good interconnects and speaker wire would be required ($200-$300)
In people's homes, I've only heard two or three good surround systems (out of ten, max). You can put together a system for less than the one I described above, but any system that will involve you and/or resemble "real life" doesn't come in a box from Wal-Mart.