Great AV but even better Stereo

Hello everybody
I am looking to upgrade a medium grade cyrus AV system into a high end AV System capable of awesome sterreo.  I know this is for some people blasphemous but I thought I could give it a go here:  Initial thoughts (all subject to appopriate negotiation and testing)
Stick with Cyrus CD XT SE+ and DAC X+ with dedicated PSX/R power supplies.  To date they have delivered brilliantly and I am impressed with the DAC X's ability to make my downloaded iTunes music sound great aswell.
Upgrade my stereo speakers - I am thinking in the first instance Wilson Audio Sasha's, but I am intrigued about the Magico Mini 2's because of their size and looks.  Cost are likely to be an issue with the Magicos though unless there is a deal to be done.  A cheaper option might be to hand around for the new B&W 800 Diamonds.  The pre-launch marketing looks very good. 
If I go B&W, logic says I go B&W for the centre speaker and with Classe amplifiers (I believe B&W use Classe for their R&D).
Otherwise I have been a Krell wannabe for years but could never afford it so if I went for the Wilson or Magico's I am thinking to go with a Krell Evolution 403 (the extra channel can drive a centre speaker).
In both scenario's I would relegate my current Cyrus CLS70 speakers to become my rears powered by my existing cyrus mono blocks (150W into 8 ohms, 240W into 4 ohms)
I would look to upgrade my Cyrus AV5 as it is not good enough to pre-amp this setup. So a capable Processor/Pre-amp combo would be good.,
Until recently I would have proposed hooking the stero config up with Crytsal Cables (Ultra) as I am told they work well with Krell amps and Wilson speakers.  I would use my existing Nordost Red Dawn cables for the surround sound speakers.
My questions centres around pre-amplification:
1.  Should I buy separate pre-amps for stereo and AV and if so how might they come together.  Is there a good enough processor/pre-amp capable of driving the Krell or Classe power amps for fantastic stereo playback ?  What would be the best way of hooking these up together?
2.  Is my decision to stick with the Cyrsus CD transport and DAC a good one?  My rationale is that CD transports are about reading 1's and 0's off a disk and not a lot else.  The CD XT SE+ has been well reviewed and comes out very well.
3.  Spending lots of money of cables (Crystal are mega-expensive) seems a luxury which possibly my ears might not appreciate - are there 80:20 options better priced or should I not even be going there.  If you have top-end kit you need top-end cables and interconnects - end of story.
4.  Is my budget (£50,000) focussed in the right areas.  As you can see I am focussing on the stereo speakers and amplifrication (and possible stereo cabling and interconnectivity.
5.  I am nervous (rightly so) about spending this sort of money - but I have been lucky to come into some money recently and want to spend it well.   Are their deals to be had??  Do discounts at the top-end exist??  How much time shoudl I plan to spend testing all this out - it strikes me there are not many (if any) dealers in the North West capable of putting such configs together.
Long question but I hope it stimulates some debate about my thinking (or some of you might feel lack of....) which I can learn from.
Many thanks - Steve