Yes, separate pre-pros will sound as good as AVR for both music and movies. Notice I didn't say it the other way around?
So you won't need 2 separate systems (one for music and one for movies), unless you just want to for the heck of it.
Really, the big difference is features like Audyssey XT32 and dual sub EQ and Dynamic EQ, which I really love.
But in Pure Direct modes, you won't be able to tell the difference.
As far as amps go, you probably don't need external amps unless you play extreme loud volume (like 100dB+ from each speaker) from a far distance (like 15FT+).
So I prefer something like Denon X4000 or older models (for cheaper prices) like 3312/3313. If you require more power, you could always add external amps later.
But the X4000 will sound every bit as good as any pre-pros out there in Direct mode and probably better than other pre-pros that don't have XT32 + dual Sub EQ + Dynamic EQ.
That's my take.
As far as the M1 speakers, I think they are fine for surround speakers. You will have to audition to see if they are good enough for center.