I've heard them on multiple occasions, with mixed results. Sometimes bad, sometimes excellent. Last year I started to look a little closer at Steinway systems, because I had to give up my larger HT room and moved my Meridian speakers (7.2k) into the living room. They do really well there, but are really large and are a little ugly to look at. The Steinways are much nicer from a design/size point of view. I was also looking at options for a new, smaller HT room (I've always had two systems, both multichannel).
Late last year I had the chance to get a home demo of the Model M to do a direct comparison. As far as design goes, it's hard to go wrong with Steinway, from an audio point of view the Meridians did everything the Model M did, just a little better. In the end, the difference in quality was enough for me to live with the large and "ugly" speakers instead of really nice looking on-walls, so I didn't make the switch. It probably wasn't a fair comparison and one of the freestanding Steinway speakers would have been a better match, but I was specifically looking at the S/M. That doesn't make them bad, they're still really good speakers. Just keep in mind what you get with these, it's a closed system, so you need the full chain and these are not "fully digital" speakers. The digital XO is between the woofer and the satellites, but the latter are still regular "analogue" speakers.
In the end, if on-wall with little depth is a must have and you don't plan to mix components from different manufacturers, you can't go wrong with these.
Most on-walls that are excellent performers are not exactly eye candy, so choices are limited. When looking at Steinway, also look at Lyngdorf or maybe the on-wall speakers from Audiovector. Alot of people who looked at the Model S, but didn't go for it for whatever reason, went with Audiovector and said it's very close to the Model S experience.
