Eddie, welcome. In looking over your post, a few thoughts come to mind: first, don't place so much emphasis on the "low profile" factor; a vertically configured speaker will generally give you better sound, and if possible should be used even for a center speaker. A relatively small Axiom speaker with excellent sound(at least "comparably good" with the Paradigm M20) is the M22.
As to the receiver, the Denon 890 would drive any of the Axiom speakers to beyond safe listening levels at typical home listening distances on the order of 10'.
On the 5.1/7.1 question, the distance behind your listening position(say at least 4' for rear speakers to form a sound field)is more significant than the room size. Note that a 7.1 channel receiver doesn't have more power supply capacity than a 5.1 channel receiver with a similar power supply; it simply can distribute that power through more channels. Most receivers these days are 7.1 or more.
