This is probably a dead thread at this point, but I'll add my input anyway.
Quality of receivers vary greatly. On this front, you really tend to get what you pay for. In many cases - particularly in the case of most Japanese receivers - manufacturer specs on amplifier power are very optimistic. Normally, they are rated with two channels driven (at 1KHz, no less, rather than full bandwidth), and produce far less output if all channels need power at the same time. Also, putting what amounts to three components (tuner, pre-amp/processor, amplifiers) in one chassis forces certain compromises that can and do impact performance (some of which have already been nicely explained by Alan, so I won't repeat). Separates, at last higher end ones, generally use superior internal components as well.
From a practical standpoint, there are other things to consider besides potential performance compromises, like upgradability. If you have separates, you can upgrade any part of the equation, keeping the rest of the components. If you have a receiver, you generally will have to replace the entire unit on each upgrade cycle. And with many separate pre-amp/processors, you can upgrade it via firmware instead of new hardware, assuming no extra physical requirements are needed. [While some receivers allow for this, you will pay a premium for this capability.]
From a sound perspective, I have directly compared a high-quality receiver with high-quality separates. The comparison in question is a Arcam AVR300 receiver vs. Arcam separates (AV9/P7) over Thiel CS1.6 speakers. While I was expecting a difference, I was floored by how clear of a difference there was (yes, they were level-matched prior to listening tests). The separates outperformed the receiver by a noticable margin in every category I can think of. Sure, the separates cost twice as much (or a bit more), but the performance increase is well worth it if you can afford part with the extra bit of cash.
