I've never heard Lexicon Logic 7 (but I did lust after their products) but I had a Sansui QSD-1 and Fosgate Tate II in house together for a number of years. In their respective stereo to surround synthesis modes they both offered 270 deg wrap around sound. It really brought a lot of enhancement to be enjoyed. But they sounded a bit different. The Sansui synthesis also enhanced the center back reverb and the Fosgate did not. Subjectively the Sansui method seemed a bit fuller (rounder?) than the Fosgate but the latter sounded a bit dryer (cleaner?) than the Sansui.
Absolutely true the SMv2 never offends and is a big step up from DPL II/. I still think it has room to improve (for stereo. Perfect for QS/SQ!) & most folks are un-aware of that as all they can compare to is something Dolby/Neo:6, or as on my pre-pro also, Anthem Logic.
The key to getting better wrap around sound from stereo with out increasing artifacts is a certain amount of control over the effect. The Fosgate offered only one mode for stereo enhance (but the S&IC did have variable) and the Sansui stuff had 3 modes of decoding, Hall (forward oriented), QS, and wrap around synthesis. I'll never pass up the chance mentioning to Chucky that some sort of similar enhancement will be much more value added than Two Speaker Surround. IIRC he feels there's enough goodness baked into the SM it doesn't need this. How about a little frosting on that cake?
He also says including too much stuff will confuse the consumer. Here's how you include those functions with input/output/balance controls & still make it look simple & attractive:
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Well, it's a crappy picture but it really look quite elegant & non-intimidating in person. The QSD-2 is another good example of doing a lot with a simple front panel design.
If I have Chucky's attention you can do away with the"modes"& just have single pot for phase balance with neutral, forward, and wrap around points indicated. I certainly think the SM would benefit from this as well as an input L/R balance control. Maybe on the new up coming pre-amp?