So - any suggestions on a "small" amp/receiver to drive a 2.1 speaker system to fill a small room?

The use of "fill" indicates that you may want a much higher sound level than is used while at the computer. It also may help to explain why three Audiobyte drivers have gone down. What did Axiom suggest was the problem(and were they mid-woofers, tweeters or both?)? You may have simply been playing them at a level well beyond what the amplifier(intended for typical computer speaker use)could handle without clipping and damaging the drivers.

If the lower sound level which is safe isn't adequate for all your uses, then yes, a bigger and more powerful setup would be needed. I'd strongly suggest a multi-channel HT receiver even if you're only considering 2.1 use now. The bass management to cross over the sub and speakers(which almost no 2-channel receivers have)is a substantial plus and the economies in producing these units in quantity result in getting more for a similar amount of money compared to stereo units.

I've visited Sydney, but know almost nothing about the Australian audio equipment market. I took a look at a Sydney dealer here for the sort of unit I might suggest, but was appalled at the price, which at about $460 USD was about twice what would be paid in the U.S. Possibly shipping and other charges involved in your buying from the U.S. would almost wipe out any savings. In any case, I'd suggest an Onkyo or Denon 5.1 model in the 80 watt or above class, or if you get just a stereo unit, the HK-3390 would be suitable.

Thanks John. I'm comfortable with the flexibility and power of the AVR approach for the reasons suggested but just don't like the physical presence for a Study. And yes we pay inflated prices down under but I could just get a second hand AVR (without any fancy Video Processing as these older HDMI units are now cheap as chips).

I've had lots of toing and froing with Axiom over this system trying to work out why I've blown 3 x "mid woofers" on the Sat and never the Tweeters or the drivers in the Sub. Axiom suggested that the system should be able to play at full vol from the included Audiobyte amp and that it must be distortion in the input but.....now I just play at lower sound pressure levels. (note: I'm also on my second amp - the first one had a bad hum to it. I've also removed the flying remote as this introduced a hum as well a certain positions.... + I replaced all the supplied cables with shielded / ferrite baluns and they made a big improvement removing hum) and so far so good. I'm just nervous of "Cranking" it up, hence the Q on the upgrade path. Given the full AVR alternative I may just enjoy what I have yet!

Another thought - on my PC I can also do full Bass Mgt in SW (I use JRiver Media Center) so a small 2ch amp + active sub would also be fine....

I've ordered another set of Algonquin for the 2.0 part (as I can redeploy them outside if needed). Say I drive the new setup with an AVR or dedicated mono blocks, can I use the AudioBytes Sub as the 0.1 with them or is the lack of cross over going to be an issue?

You probably won't be able to use the sub with them, either. Sorry!

On the plus side M3s do sound excellent without a sub. I used M2s for a while as computer speakers and even with a sub found them lacking (though they were very clear and precise, just "lacking" that certain je ne sais quoi). I now use M22s for the computer with a sub and love them. My M3s serve as a standalone 2.0 system in the bedroom and I love them as well.