Which would you choose as most important?
Setup or equipment?
Or, put another way, which would sound best—mediocre equipment setup properly, or the opposite?
My first reaction is setup. I would guess that if you plunk down in the wrong place the grandest speakers in the world powered by exquisite electronics it wouldn't sound as good as a perfectly set up pair of decent bookshelf speakers powered by an off-the-shelf integrated.
Sure, you might hear vestiges of greatness through the expensive system but my vote remains setup.
I've heard more great systems sound like dog meat because they weren't set up properly than I have the occasional gem of decent equipment lovingly placed where it belongs.
Proper setup is non-negotiable.
Time spent perfecting your rig outperforms all the money spent on gear, and then some.