The only reason I would buy the Denon 4700 over the 3700 is if I wanted Auro-3D. If you don't have Height Speakers then you won't miss Auro-3D. Personally, I really like Auro-3D in my 7.2.4 setup - so I went with the Denon 4700.
As to the question of what do you lose while in Pre-amp mode? The Zone 2 and Zone 3 modes on the Denon 4700 are not functional in Pre-amp mode. Same applies to Zone 2 with Denon 3700. When the receiver is in pre-amp mode only the functions labeled on the speaker terminals are available. Otherwise, everything else works the same.
Thank you. Does the HEOS function still work when using an external amp? I would think it does. My local sound shop will give me a HEOS speaker which I would like to run in my bedroom.