I was just tweaking with the Dimension setting. This adjusts the front & rear positioning of the surround field. Higher settings move the surround field to the front and lower settings move it to the rear.

I also listened to Oscar Peterson again, this time at a normal listening level instead of quietly and noticed that the wrap-around effect was still there with PLIIx even with the surrounds dialed down low. There was no wrap-around with Neo at all.

So I've come to the conclusion that if the source contains significant ambience content, use Neo to avoid the wrap-around effect. If there isn't (ie. recorded with a close mic), use PLIIx.

What I don't understand however is why PLIIx and Neo sound nearly identical on track 3 of Into the Labyrinth. There's definitely ambience on that track but somehow it appears to be channeled down the centre of the room rather than to the sides.