Well, while I admit that I am fairly ignorant on this issue, I did have a Harmon Kardon AVR325 hooked up to the exact same set up (except the sub) and never had any issues with distortion or cutting out. And I don't normally listen at +8 db. I was simply stretching the legs of my new receiver to hear the limits of it's ability. I suppose you are all correct though. The unit is on the way back. When it arrives I will switch back and forth from the old HK and the new Yamaha and compare the clarity and volume. I still think there may be an issue with the unit. But thank you for your assistance.