I have a denon AVR-1709 & Polk audio 5.1 Speaker. I connect the receiver via Creative Audigy2 Zs Sound card in Pc. I connected analog for Mp3 & other stereo track & Digital connection for DVD or .Mkv files. I want upgrade my setup but I confused ….
1) I upgrade my AVR?
2) I upgrade my sound card or go for high-end DVD & Blue ray players?
what? you should only have one connection from pc to avr.
if your video card supports sound out via dvi i do highly suggest running a dvi-to-hdmi cable to your avr and then just export the video to your pc monitor via hdmi. the other option is to just run an optical out from your soundcard to the avr. both options are the best sound quality you will get.
as far as upgrades go..
cd/dvd/br player...this only reads information from the disk it does not process the information. upgrade this only if you are having problems burning disks or reading disks. a $20 drive will affect video playback as well as a $200 drive provided that your movies are not skipping due to the player not being able to read the disk fast enough in which case an upgrade might help (if its not another issue). in essence... you shouldnt have to worry about it.
avr... does it have dolby digital and other modes you want? does it have the hdmi inputs, etcetera that you want? does it have enough power to amp your speakers you have now (or future speakers)? does it have any problems? as long as you have the required inputs/outputs and you are happy with the surround modes it has then you should be okay here. denon in general isnt a bad brand.
speakers...not sure on the quality of speakers you are using but getting a better set of speakers could definitely improve sound output. upgrading other factors might not do much if you have shoddy speakers in general.
software...you could potentially get better sound output if you use software capable of dolby digital or other audio modes instead of software which is more limited. in general though unless you are using some shoddy software the differences between this shouldnt be much. keep in mind that some software allows you to adjust individual audio levels (equalizer).
source... using blueray disks over dvd will definitely improve sound as the files on the disk are uncompressed and i believe full quality. however this means that you need to buy blueray disks which cost more. if anything you can compare blueray playback to dvd playback on what you have now... perhaps this is the only factor you need to address.