When I was in the market for a new home theater that had dolby atmos i considered in-ceiling speakers, add-on atmos modulesand built-in upward-firing add-on module.
In the end I settled on 5.1.2 system with dolby enabled speakers in the form of : 2x Kliosch RP-8060FA, RP-504c and 2x RP-502S + Nvidia Shield Pro + Marantz Receiver.
After reading many many forums, the recommendation was always: you need in-ceiling speakers and that upward firing "bouncy house" dolby-enabled speakers were the lesser option, that were bad and not effective.
Initially when I ran the Audessey setup I wasn't impressed. But after correctly setting the distance between the speaker and the ceiling and bumping up levels of the upward-firing modules, I was left shocked by how effective and precise the effect was.
A few things I noticed:
1. The sound could not be localized as coming from the speakers, it was clearly coming from above. I was so impressed that I dsiabled the surrounds to make sure of what I was listening.
2. The sound didnt only seem to come from above the front speakers, but somehow further back, above the listening position! In Mad Max Fury Road, when immortan joe fights the old lady with the shotgun and it shoots up, the initial shot sounds from above the LCR, and ripples backwards towards the listening position as "debree falls from the roof" above the listening position. The initial shot sounded more in front. I wasn't aware that dolby speakers had this much precision to sound above LCR, but also further back, above the listening position. This makes height speakers in the back less crucial to me based in what I am hearing.
3. In Alita battle angel (atmos version) I was impressed how the sound was creating the effect of convincingly dripping water from the entire ceiling and not just above the LCR. (Also above the main listening position)
4. With all the dolby atmos demos, the sound abive you was clearly moving backwards and forwards above you and NOT just above the front LCR, even in my 5.1.2 system.
5. My strangest observation was that when I put my ears near the upwards shooting speakers, they did not sound like they were doing alot, but sitting in at the main listening position, the sound coming from above is incredibly loud. This leads me to believe they are highly directional, especially with the foam surrounds.
6. Based on how directional the sound is, I have a feeling that add-on modules are simply not as effective.
Based on my experience you don't need in-roof speakers. If setup right, dolby enabled speakers are veryyyy very convincing.
Also, based on my listening experience, just two front dolby enabled speakers seem to be able to produce elevation effects not only above the LCR, but also towards the back, above the listening position. This makes imho a 5.1.4 systen less crucial. In short, you don't need in-ceiling speakers to have a convining atmos experience. You will need to bump up the level quite a lot in the receiver and it is crucial to measure the disgancd between the dolby enabled speakers and the ceiling.
Thoughts and questions are welcome.