The Denon I used previously was a 2307 that had little to no video processing at all. Yet I noticed an immediate improvement in image quality when switching to the Integra. I'm not sure that older Denon model was signal neutral in it's pass through video processing.
If I understood correctly, we both found out the build in upscaling capability does not seem to be as critical as the PQ capability of the media player itself. The fact that there are VPs in the TV, AVR, media player, plus the effect of the source disc, make it really hard to determine the weakest link. I am surprised to know that you have the Reon equipped Integra yet still prefer the pass through mode. My only gripe with the 4308 is that it costs more than the comparable Onkyo/Integra but without the Reon. Had it come with the Reon, I would likely still use pass through, but it may prove useful in situations unknown to me yet.