I think you are safe, but you obviously are hitting the limit of the Crown amps, so you really should turn the volume on the Denon down by a couple of dB and you should not lit those lights. The sensitivity of the Crown amp should actually be a good match for the Denon/Marantz AVRs.
You've got that right, if you raise the Crown's input sensitivity to 0.7, you will over drive the Crowns and if your hearing is good you will hear the distortions from clipping. Don't do it!!
You have two/three (1&3 related) options:
1. Turn it down from 88 to 80, and you should still be at THX reference level, and that would be roughly as loud as what you hear sitting in a movie cinema especially one that is set to THX standard.
2. Get a bigger amp for the SVS towers and center, such as the XLS1502, XPA-3.
3. Sit 2-3 ft closer and lower the volume to 80.
Note: In any case, try setting the Crossover for the SVS towers and center to 90 Hz, and the other speakers to 100 Hz. Let the extremely capable PB4000 take more load off the Crown and UPA amps.
No one knows exactly what that 1.2 V is based on, it could be a continuous rating at a specific THD and impedance load. May be some day
@gene can find out exactly what Denon's bench test/specs protocol is if he can reach the right person. As far as I know, they don't let ordinary people like me talk pass their customer support reps. From Gene's review on the AVR-X3300W, that has identical preamp/amp section as the AVR-X3400H/X3500H, the pre-out voltages had no trouble exceeding 2 V unclipped!
In that review, he said:
With those speakers (sensitivity 87 dB/2.83V/1m, recommended amp power 20-250 W),you better option is 1) or 3) I listed above. That is, turn down the volume and sit closer if you could. Your spl requirements is just a little too much for them in a large room. The SVS Ultra towers would have been better, though still not by much. I may be too conservative, so if you want more accurate/realistic answer, give SVS a call. Ed, their VP, is a very helpful person, so email him or try to get him on the phone about your situation.
I think it may be better for it to stay in this thread because I suspect many mid range AVR users do use external amps anyway.