I would not say better off, no. Many people are perfectly content with HDMI/MCPM.
It shouldn't matter (for sound quality) whether the player or the AVR decodes the soundtrack, if both decoders work properly.
Some people have mentioned bitstream avoids any bass management issues. That could be true. There's a mess concerning LFE tracks that have been attentuated by 10Db when recorded. To be honest I have read conflicting reports on the exact situation. It's possible bitstream gets around those issues.
Bitstream also increases the chances that you can apply Dolby Pro Logic IIx processing or other processing. AVRs often don't seem to be able to apply processing to MPCM, which I can understand.
On the other hand, bitstream doesn't allow for in player mixing; for example you may not be able to hear audio commentary if you use bitstream.
In summary, they have their pros and cons