is a center channel really necessary??

I don't use a center channel in my HT room, mainly because a lot of the older films I enjoy sound crappy with everything coming out of the center channel only. I would rather spread the sound to both sides, even if some of it is mono. Just my opinion, of course.

I would first set up the 2 channel exactly the way you want it. The speakers are dialed in to their best spot and the electronics are off to the side and your chair is where you like to listen. Then add the extra speakers for 5.1. You can either optimize 2.0 or 5.1 but very difficult to do both equally well. That said, I like having the center for dialogue movies and SACD. Listening to full orchestras with SACD is simply amazing. I recommend the center channel.

For a 2.1 system, couldn't I choose a BlueRay player that downmixes into 2 channel rather than doing it in an AVR?? I believe the Oppo BDP-93 SE does this.

I have a 7.1 setup with 2 x Aerial 20Ts for left/right and Aeiral CC5 for center channel. For movies I definately prefer to use my center channel. It is very good, blends perfectly with my mains and makes dialogue more realistic.

Personally, I've become less and less interested in 5.1, which (esp. for music) inevitably sounds processed and unnatural to me. i still have a surround setup in my living room, but find i do almost all my movie watching/music listening on a secondary 2ch system. perhaps if i watched alot of action movie i'd crave the sensation of explosions behind me, but i've never felt i'm missing dialogue or anything essential.
ergo, i vote with the folk who recommend getting the best two channel setup you can afford now (full range speakers and 2ch integrated); conceivably you can add more gear in the future if you feel you need it, but at the very least you'll have a great base to build upon.