I think you're starting to see that a good setup is cumulative. Unfortunately, stereos will NEVER be able to equal a live performance - but it can recreate A LOT of what the recording engineer originally interpreted as correctness of the performance. You should check out a book called "This Is Your Brain On Music" by Daniel J. Levitin, an engineer. Levitin goes through and explains (more or less) exactly what is going on in our head when music strikes our eardrums. Also, I want to add that there now exists an AMAZING little product by Copland that EQ's & time aligns sound as it exits your speakers (with help from a microphone sited @ your listening position) with the press of a button...could be just the thing you need to combat that tiny listening room and your next room.
http://www.copland.dk/top/copland205index.html