I had a Denon 5.1 system since 2008, and it sounded like gold. I fought replacing it for years, because it sounded so, so good, but since it only had two HDMI outputs, and with cable, DVD, media player, PS3, xBox360, that was a problem, I finally crossed my fingers and went and upgraded my unit (also a Denon). About a $800 unit on sale for $450 +/-, and if anything, it sounds better than the old one. It's got a module that allows me to set up the unit based on the speaker arrangement, and my goodness, does it sound great. There's a module/filter/whatever that will deliver the 2.0 stereo media (a CD) to 5.1, and while I imagine that an audiophile (remember Glass Dream?) would shit themselves over that but man, does it sound good. It's hard to describe, but it's a PRESENCE. I have one of the speakers behind my head to the right, and for sports, it's amazingly immersive. For music, especially older material, it just makes the music breath. A Farewell To Kings CD sounds earth-shaking, as does Fly By Night.
As for 5.1 mixes, it's a mixed bag; KevShmev is sort of right. It's all in the mix; it can get too gimmicky, and that sucks. The Genesis and King Crimson 5.1 mixes are in my mind, state of the art. The two Dream Theater ones I have (Systematic Chaos and Black Clouds...) are only okay; they are sort of dense messes. I have the Special Edition 2112 and Moving Pictures and they just seem like missed opportunities (I had to check a couple times to see if the MP was even delivering in 5.1. The Sector boxset 5.1 mixes are slightly - slightly - better, but honestly I can barely tell the difference between the actual 5.1 mix of AFTK and the stereo version decoded to 5.1 artificially.
The last thing I think you want (read: I want) is a bunch of cheesy panning (think of that moment in Yours Is No Disgrace where Steve hits the strings above the nut "ching ching" and it pans hard left, then hard right), since it makes it more of a distraction than an immersive experience.
I have the Wilson Yes disks, two Soundgarden disks (BMF and Superunknown), Temple of the Dog, and Floyd's DSOTM, WYWH, and Animals to listen to and I haven't yet (waiting for a good, cold, perhaps snowy Saturday afternoon to dig in).