Questions on a new setup!

[kyloren]

First off, please excuse my ignorance, I’m trying to get my feet wet here. I’m looking to up my audio game with my tax return and I’m curious what you guys think the right move is.

My current living space is your typical apartment, but I’m lucky to be in a spot where I can properly enjoy the sound at a respectable volume. I’m assuming a nice soundbar setup with rear speakers might do the trick for my situation. I have a 4K setup that I mostly use for UHD movies, so it’s time to add the right audio for full immersion! My current audio setup is trash.

Is a home theater system like building your own computer? Meaning if a new Dolby Atmos soundbar costs $1600, would it be better to start building your own system with that money piece by piece… because in the end it will be fully superior and worth the money you put into it?

I’ve seen some of the amazing setup’s on this site and I’m assuming a Dolby Atmos soundbar can’t be compared, because we’re talking a soundbar vs. a full system. How can a soundbar properly produce Dolby Atmos? Is it a play on words to increase the price? Or is it producing a form of Atmos with added effects?

If I bought a nice 5.1 Channel Setup, would I be able to tell the difference if I stepped up to a "better" 7.1 Channel Setup? Can you really tell that the Dolby Atmos soundbars are better? Is there a massive difference when you jump from 5.1 to 7.1 to Atmos? Is it worth it?

I’m sorry if this is too long or if it doesn’t make sense. Any recommendations will be helpful. I'm not looking to get a budget product, I'm looking to get something nice.