I used to run a def tech set up in my HT. My front stage consisted of SM450's for L/R, PM2000 center, and di-pole 1.2x's in the rear. For HT it was a pretty awesome set up. No complaints. Music however, I felt the SM450's were a bit lifeless. I ended up upgrading to an Ascend front stage, towers and horizon center. Great for HT and awesome for music.
If it were me, with that budget I'd go with the following:
Denon 4311: $1,200
Front stage: Ascend Sierra's $1,500
Surrounds: Ascend HTM-200: $300
That would leave you $1,000 for a sub.
Dolby Atmos 5.1.4
Ascend Acoustics Towers and Horizon Center (NrT)
RSL 34CE in-ceilings (4)