There are some receivers that do upconverting, but many more which do transcoding. That is, if you plug in via composite or s-video they convert from that type of input to component video output. That video conversion is called transcoding. If your receiver does that, then you can have multiple component, s-video, and composite sources, but just use the component video connection to your display.
Newer A/V receivers with HDMI are also doing transcoding and upconverion to the HDMI output. Truly a one wire to the display solution.
One of the added benefits to the component connection from the receiver is that you often will get on screen information, such as volume level, or input selection, on screen when you make a change. This doesn't matter to some people, but many more like to be able to see where their volume level is at as they adjust it and to see what input they are on without looking at the receiver.
Personally, I always go through the receiver as I always need the extra switching ability that it provides.