It should be noted, indeed, sagely pondered, however, that Dolby is in the business of making and licencing decoder circuits. I'll definitely be attending his ICMC paper. He also has an excellent tutorial on the pyschoacoustics of localization. Ircam's jMax-based sound processing application, uses initial reflections to localize and simulate movement. Also, follow links from Spat's home page or jump directly to formidable papers on room acoustics .
Some people report using it for music diffusion.
There's some cueing software for it called VDesk . I recall one of the fellows from Sound Traffic Control using it for inexpensive live work, although they usually use high-end Level Control System matrix mixers.