John, it's highly unlikely that you'll benefit by lowering the 80Hz crossover. Your center and surrounds would be down considerably at 60Hz, which would lead to some weakness in that mid-bass area. Stay with all speakers small and an 80Hz crossover. This isn't something that was selected arbitrarily; extensive tests by THX and confirmed by Nousaine among others showed this to be the best compromise, being high enough to take a significant part of the load off of the speakers and the receiver, but not so high as to make the sub easily localizable.
Yes, turn the crossover control on the sub all the way up to 120Hz to try to get it out of the way of the 80Hz cross the receiver does. As Nousaine's test on the LW-12 showed, there are less boomy subs available, so don't expect to get an ideal balance.
