Handle9: Atmos is really a nice to have - I wouldn't use it unless I upgraded speakers. That won't happen in the near future.
I don't plan on buying another receiver for 5-7 years (I've had my onkyo for 7 years) so would prefer to buy something with a bit of head room.
I would look at the RXV-685 then; for the little bit extra it price adds on over the RXV-585, you get better room correction (YPAO RSC), as well as Zone 2 pre-outs, and an extra HDMI port in. The extra 10wpc makes zero effective difference really.
Another option: you could get a similar feature-set cheaper in an Onkyo or Pioneer AVR (minus the MusicCast of course), even though they are not as well regarded as Yamaha. I paid $697 NZD for my Onkyo NR-676 which does pretty much all the same stuff as the RXV-685, bar 4k up-scaling (which is a useless feature IMO, your TV or media player will do it better). The room correction is definitely not the greatest, and the DAC will be a matter of taste (a single AKM AK4458 vs 4 x unnamed Burr-Browns), but really, for critical listening, you probably shouldn't be looking at AVRs. Up to you whether the price difference is worth it; the current model is the Onkyo NR-696, but even the next step up to the higher quality RZ series could be possible for a similar sort of price as the RXV-685.
Anything above sounds like you will be paying more for features you may or may not use. The only reason you would really want to go higher at this time is to add on pre-outs for external amps, process more channels, or better room correction software. It looks like the 2020 AVRs are shaping up to be the bare minimum number of HDMI 2.1 ports slapped onto them to call themselves "8k ready" over this year, so most people will get better value trying to get a current AVR at a discount and syndicating HDMI 2.1 devices on an appropriate TV.
It's a fairly reasonable price bump from the 585 to the 685. Is the better room correction $250 worth? An extra HDMI and Zone 2 Preouts are nice but unlikely to get used.