For around $1000 to spend, I would look real hard at the 818, even with the bug (which hopefully will be fixed soon). Or I would see if I could get a nice close out price on one of the remaining older denon 4311's.
also better speakers usually results in better sound. however in your case with your current old avr lacking in modern features and room correction upgrading to a newer one should result in a noticeable positive difference.
I don't need snobs to tell me how to think, thank you!