The resultant decision is not merely going to be a matter of what is perceived as better here, will be a resultant of budget and your preference. You have made your preference clear but budget is also important depending on the speaker.
Assuming you are willing to invest in future towards a stereo setup I would recommend following steps
i) A 5.1 setup with AVR is worth getting at any point of time if you are going to watch even one movie a week or more , this is simply more engaging and all contents support 5.1 or beyond. The AVR will do fine for stereo listening too
To start with get an AVR with pre-outs ( depending on your budget you will need to go for the respective options, Marantz NR1509/1609 is the lowest level where you will have pre-outs for fronts / At next budget you have Marantz SR5015, Yahama offerings / At slightly higher budget Denon X3700H/Marantz SR6015 etc) . This will set you up for setting up a parallel/alternate stereo chain in an effective manner. Setup a 3.0/3.1 system to start with and get some budget surrounds/get some satellite speakers if possible.
By doing the above you are setting up a system which will do well for your 20% use case, will do just fine for the 80% music/stereo use case.
ii) You have 2 options here once you have setup your AVR HT setup,
- Going seperates for stereo which basically means having seperate components for as many function as possible (Source/+DAC, Preamp , Poweramp) or getting an All in One (DAC+Streamer+ Preamp + Poweramp in single box) or
- Integrated Amp ( can include everything other than streaming, or might just be an amplifier needing a seperate DAC). I will not dwelve into which sounds better and which does not , you will find many threads to read and as per your budget/aesthetic preference go for one accordingly.
Try borrowing some integrated amplifiers from fellow members in Chennai or get an used one in budget so that you can try and pass it on in future for another member who is trying to experience the same, use it with your speakers and see if it makes a difference. Since you would have used AVR for a good period , you will be able to make an informed choice on whether the stereo amplifier benefits your system. If it does jump in this rabbit hole , else continue using the AVR as your main unit for music listening too
Coming to personal preferences I find myself leaning towards separates the most as it gives the flexibility to experiment and play around and also performance offered IMO felt superior to other alternatives I tried in a similar budget. However you will find equally opposite opinions too, so making sure you try out these yourself before delving deeper is the only way to be sure in this hobby.