$ 1,000 A/V receiever recomendations...

I wouldn't do it. I would look around here or VG and find a used 5 channel amp and a cheap processor to hold you over until you can afford a better processor.
Why tie yourself in to a receiver? It just doesn't make sense.

"Why tie yourself in to a receiver? It just doesn't make sense."
Not unless the receiver has an excellent processor built in, and then some. I cannot recommend the Yamaha RX-V1400/2400 more highly. Yamaha's Cinema DSPs are among the best, just add a separate amp to drive at least the main 5 channels. The receiver's amp section is fully capable of driving the last 2 channels of rear surround.

The DSP section uses 32bit processors and the 24bit DACs, while the vol control for all channels are matched to within 0.5db. Its a full fledged machine.

I would recommend the HK 7200 on sale for $899.

Denon 3803

Denon 3803. The upconvertion is awesome! You can take any signal and the Denon outputs in RGB, one cable. It also has a great sound and the DACs are better than the Yam's as Yamaha produce in house where Denon goes out and buys the best and uses economies of scale to get the costs down. I feel safer with a Japanese made piece that that made in Malaysia. I have heard from a lot of audiophiles that there is no such reciever that is good at $1,000. I got the Denon...I like it and down the road I will add a power amp and use the Denon as a preamp until I can afford a really nice preamp. The 3803 also has more inputs that you know what to do with so you are not really limited to options.