If it is recorded properly then I don't see why you would need channel balance and bass management if your speakers are set up correctly.
I output DSD natively and my receiver processes DSD>Analog without ever hitting the PCM realm and I do appreciate the difference in sound. There are plenty of receivers out there that give you the option to go from DSD>Analog without DSP processing or decimation to PCM.
Here's
Denon's 4308CI:
Here's
Onkyo's TX-SR905:
However I disagree that changing to PCM brings you down to CD quality because most DSD>PCM processing decimates to 24/88.2 (or 24/176.4 in the SACD-capable PS3 models) not 16/44.1.
I agree that CD has far more potential than it does now. The mastering and production stages have both squeezed the dynamic and life out of so many recordings thanks to far too much gain and drc. However I do think that CD has shortcomings as a format and I think Bob @ Meridian outlined it pretty well.
http://www.meridian-audio.com/w_paper/Coding2.PDF
Bad CD? - Most of Oasis' releases
Good CD? - The Stone Roses debut album
They're night and day...but having also acquired a mint copy of The Stone Roses on vinyl I can tell you that it does sound better even that that GOOD CD and makes me yearn for a Blu-ray release of said album. Why Blu-ray? Because the major labels for all intents and purposes are done with SACD and DVD-Audio and for a new format to gain any ground it has to appease all markets, not just the audiophiles. Blu-ray with its HD video capabilities, interactivity, BD Live, HD audio, etc., etc., add in a CD for digital copy and you've pretty much got every market from the mass to the niche nailed.