Maid, technically you are correct in that you bitstream AC3 (dolby digital) and DTS to your AVR with your 9500GT. However, most advanced users kind of take for granted that video cards capable to sound will bitstream those formats. So, when we say bitstreaming, we're actually usually referring to the lossless codecs of Dolby TrueHD and DTS-HD MA. Your card cannot do that, but it will pass on decoded lossless audio up to 7.1 as LPCM.
You will not hear any difference in your setup by letting the PC do the decoding, unless you play with some other settings too. What you need to do is to boost the centre channel from your AVR if you have access to those settings, which you must. The centre channel is where the dialogue/speech primarily comes form. By boosting it preferentially, the difference between the explosions and speech will be less. You'll need your AVR manual. Another option is to turn on dynamic range compression (DRC) or 'night' mode on your AVR. This kind of achieves the same thing.
Alternatively, if you do decode in MC, you will probably be able to boost your centre channel using the DSP settings.