I was thinking about getting a better stereo system maybe with surround sound after seeing some of the winners/nominees for "Grammy Award for Best Surround Sound Album".

Now I prefer vinyl, and was wondering if any receiver can go 5.1 stereo or if I need a special one. This is quite old but I use a Kenwood KR-720 if anyone happens to know it. I'm just not sure how to tell if it can go surround.

If you have surround exits for 5 speakers and a subwoofer it can.

How can I tell?

Should be some exits titled LF (Left Front), RF (Right Front), Center, etc.

Mine also says 5.1 on the front.

Just because I'm still sort of lost, I found a picture of the back of my receiver.

http://www.blackswampaudio.com/Images/Inv/197.1.jpg

That won't be able to do 5.1 surround I'm afraid.

Mmkay, I've got another receiver in my living room that I guess might work, it's a Yamaha HTR-5740 and the Yamaha website says it can go 6.1, does that mean 5.1 works too?

Yep.