I was with you for a LONG time on the large vs. small setting. I had things set to large and really liked it for a full sound for stereo music listening, but if I wanted more punch, I'd force the sub into the mix. For movies, I messed around with the large setting for a long time before finding that those crazy THX folks must have figured something out and unless you have subs built in to your front speakers, small sounded better.
There is logic behind it, and a lot of people get stuck on the words "large" and "small"... Bass Management Guide part 1
I love the quote from the above article:
People have a psycological difficulty with the word SMALL. They have spent good money on their front speakers and get insulted when the AVR sets them to SMALL. Remember that this is not a personal insult against you or your speakers. My Definitive Technology front speakers have 15" built-in subwoofers with built-in 300 watt amplifiers. In addition to those, I have six external subwoofers in my HT room. When I set the front speakers to SMALL, the quality of the sound (both music and movies) improves.
It is helpful to redefine the words SMALL and LARGE to:
LARGE = The speakers are not Bass Managed.
SMALL = The speakers are Bass Managed.
The rest of the info on the subject can be found here: Bass Management part 2
If you want more information, albeit from the Audyssey folks, read this blog article: Small vs. Large
I like this quote from the blog:
Here is a better rule: All speakers are Small. In today’s complicated AVR lingo that just means: If you have a subwoofer you should always turn bass management on. Always. Even if your receiver clings to the past and automatically sets your speakers to Large.