I will say I am surprised that a new sub may be in order, as Socketman guessed, I wasn't looking to have to buy all new stuff yet. I had come to terms with most likely needing a new LCR before posting on here, this was more so a last ditch let me see what options I have from the knowledge of those who know more than I.
I'm a bit alarmed reading this - I don't think we were trying to give you the message that you *need* to replace anything. The only reason IMO that you would *have* to replace the M80s is if you put them in the room and your family said "they're too damn big and they can't stay here".
You will need at least some room treatments (esp. first reflection points) but those are easy to do and as Mojo said you may be able to do that with things you would want to hang on the wall anyways (as long as your taste in art leans towards fluffy things :)). I believe one of the members here is making some awesome "art + acoustic panel" products which might be an option. My (poor) understanding is that in general smaller rooms need relatively more of the surface area treated than larger rooms but I'm not 100% sure about that.
I don't have much experience with sealed vs ported subs but my impression is that the sealed ones are sometimes easier to find "good enough" placement for... but IMO with a room that size and two subs to play with it shouldn't be too hard anyways.
EDIT - LOL, Mojo posted at the same time as me but we ended up with fairly contradictory messages. I don't disagree with what he is saying, except to the extent that you already have a system and IMO it would be worth setting it up and playing with it a bit before you start replacing things.
I guess I'm trying to say "yes there are good options for changing your components and improving the sound, but just moving to a smaller room should not be the reason you do it"...
... says the guy using M40's as very nice PC speakers
