There's a couple of things to look at first:
- is your TV 1080p?
- if so, which does the better job of upscaling non-BD source material to 1080p: the BD player, the amp or the TV?
- is your amp able to feed the TV with 1080p video?
- what about the new Hi-Def sound formats? Is your BD player able to decode them? Is your amp able to decode them? If both, which does the better job of the two? (HDMI can be used for either digital output or decoded audio).

Assuming your 7.1 amp is able to decode Hi-Def sound formats and capable of 1080p output, I'd say: HDMI from BD player to amp and then again HDMI from amp to TV. That's the way I have hooked up my own gear as well.

I have mine running like this: HDMI Blu-ray to Amp, Amp to TV using HDMI.

I don't see why you can't go component out from Blu-ray to TV, then go Digital/Coaxial on blu-ray to TV. It just means that when you have the amp on you just have to shut off your TV speaker. Your Blu-ray player should default to HDMI when the amp is on. Because there should be a video 1 where your HDMI connection is and a video 3 or 4 wear the component goes. This means that to watch HDMI connected equipment will be on your video 1 setting, while your component would be on video 3 or 4.

Run your HDMI to the amp from the DVD player, then to the TV.  Turn off the TV speakers and run the coax from your Blu-ray to the amp for audio.  If you have cable TV, run that to the amp as well, and use either a second HDMI or component for the video to the TV, and the amp will take care of the audio.

That's how I've set mine up.  I only one HDMI input on the TV, so I originally had an HDMI switch that let me switch inputs between my DVD and the cable DVR box.  But my A/V receiver died and the Sony I replaced it with has dedicated HDMI outputs, so I have to run the DVD to the TV, and the cable video via component.  The audio is handled by the new receiver just by switching the input between cable and DVD.  Of course, I have to also change the input on TV between cable and DVD which I didn't have to do before with the switch. 

Nothing is ever simple and easy.  You'll end up trying several setups before finding the one that gives you the best performance, and it will be dictated by the hardware in most cases as it was in my case.

Thanks  all... 

Don't see why you'd use anything other than HDMI if you have the connections open for it.

My TV doesn't have HDMI in, so I had to get an amp with HDMI audio handled separately from video.  Running HDMI from Blu-ray to amp for audio, and component  from the Blu-ray to the amp to the TV and it works just dandy.  But the first receiver I tried wouldn't allow you to handle HDMI audio separately, so if you are in the same boat you need to be careful in choosing the amp.