Hmm...Since no one was able to answer this question, I went out and did some actual research. I am posting the reply to my own question in case anyone was following this thread...
I found the "recommended" solution for a 7.1 channel system in a Home Theater magazine last night.
First, a quick "WHY" of the 7.1 channel setup. In a 5.1 channel setup, it is difficult for movie producers to create an "image" behind the listener to accurately place objects there. For instance, when a space ship flies over the listener, a 5.1 movie setup will "smear" the sound of the ship to the diffuse sides as it approaches the listener. Surround sound is awesome for "diffuse" effects (rain, wind, etc.) but not so good when trying to localize an image.
Picture a ship flying towards you with this setup (the sides are dipoles for movie watching) and what happens as the ship approaches the listener. The sound gets more diffuse, and smeared to the sides.
The 7.1 channel system was designed to help with this problem by allowing a discrete rear channel that can form an image, if needed by the movie. There are a couple of dozen movies that use the 7.1 format today (THX EX or DTS ES).
Here is my picture of this magazine's recommended way to set up a 7.1 system:
1. 3 Front channels - as they always are.
2. For the side and rear surrounds, use 4 identical dipole.
3. The 2 sides are mounted normally, but the 2 left channels are mounted "inverted", so that no images are produces between speakers except that the two rear channels can produce an image between them. Inverting the speakers should have no effect on their sound since the 2 drivers reproduce an identical source.
4. All the dipoles act as "surround" sources (diffuse, unlocalizable sound) except the rear 2 create an image.
5. For 5.1 recorded movies (Non EX or ES), the REAR 2 speakers should be turned off (returning the system to a 5.1 setup identical to the picture above) to respect the mixer's vision when mixing for a 5.1 setup.
6. For 5.1 recorded MUSIC, the SIDE 2 speakers should be turned off, allowing the music to create a distinct image in the rear.
Does anyone have any critique of this setup? I am considering doing this very thing, so I would be very thankful for any feedback.