Absolutely need to keep SQ. I thought these units were made for only Quad folks. Although, one could see a lot of upside for the stereo to surround crowd - if they would or do buy these units. My recommendation would be to add modes, not take anything away as general thought.
Wasn’t there two different modes for SQ in an earlier model? Regular SQ and another mode for SQ records?
To OQG et al. I obviously failed to communicate that my comment on dropping SQ & TSS was in context to Chucky's comment on the current "universality' of the Surround Master. And his noting that he doesn't have to get out of his sweet spot, I guess, to switch decoding modes. So let me repeat myself, I love having the SQ decoding mode just like you do.
But the real value to more than us dedicated quaddies is the ability to produce high quality surround sound from regular 2 ch stereo sources. The Involve/QS is an excellent basis for this, SQ not so much & again I say nobody purchased a Surround Master for TSS.
I don't think there is enough advancement in the SM v3 to entice any owner of the current v2. But for those that don't have a SM at all or an older v1, this would be a great little black box to buy.
What would be a major improvement in the next design? Much has been said about window dressing such as meters, 'scopes. But function wise more inputs, master output volume control, input L/R balance control and yes, a classic 270 deg wrap around effect. Best of all it be profoundly simple to implement what I call a phase balance variable control on the front that adjusts the relative balance between in phase/ opposite phase of the input signal. Once upon a time I had an APT Holman preamplifier that was largely purchased because it had a "mode" balance control that did this:
I think Phase Linear & Carver had something similar to this but it was called a "Panorama" control. Whatever the name it makes a huge difference in controlling the decoded output from stereo. Yes the effect is very different from simply changing the front or back output levels after decoding.
And then there is the HDMI, or lack there of. Although I don't need it, I think this will be a necessity to integrate the SM into more modern mainstream HT set ups. Isn't it possible to buy an OEM HDMI board from a MFG'er that has already paid the licensing fees & jumped through the hoops? Thanks to @gene_stl for that last idea.