Ah the perennial question...
***WARNING - ESSAY FOLLOWS***
As a new AxeFX user, I did heaps of research and found there is no simple formula, as noted above. However I have gleaned some wisdom from these forums.
First, there are three main ways of producing sound from the unit:
1) plugging it into a guitar amp's power section (and mic'ing this for FOH if you need to)
2) plugging into FRFR monitors (and typically also sending it to FOH as a direct signal)
3) using headphones.
Second, there are two
purposes for producing sound from the unit:
1) practicing and dialing in sounds;
2) playing live.
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For purpose number 1, I have learned that headphones just don't cut it for dialling in accurate tones, unless you spend more than I am willing to part with on cans. Additionally, you have to dial them in
at or close to gig volume, because the bass and treble will be heard differently at this volume. Get into a hall somewhere and crank it.
So for dialling in tones, you sort of have to choose whether you plan to use a traditional amp cab, or FRFR, as each setup will require you to dial in the presets differently. Probably obvious, but you shouldn't dial in tones in FRFR mode and then play through a cab.
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As for the guitar cab vs FRFR thing, this is entirely a matter of personal taste, and in a less civilised forum than ours, could probably become a religious war
We have a very healthy community where this has been discussed respectfully, if
ad infinitum.
One objective truth, however, is that a cab will really only sound like itself, whereas FRFR can sound close to any cab you like. However, FRFR is a different experience to a live cab. It takes some getting used to and adjusting. Don't get sucked in to the 'Amp In The Room' (AITR) rabbit-hole. With FRFR, you will hear what 99% of people have only ever heard: the sound of a recorded/mic'ed guitar. Only us guitarist have ever had the serene ecstasy of standing in front of a cooking tube amp, and if you don't want to let that go, consider running a cab - but unless you are playing in a small venue (where you can't cook the tubes anyway) you are the only person that will hear it. I prefer FRFR because I hear what the audience hears, and I can change it if it sucks.
I would recommend going with FRFR and adapting what you expect to hear. It sounds *amazing*. I don't miss my tube amp at all. Even though I spent 15 years getting it just right, it only had that sound. As for speakers, I ended getting the JBL EON 610s, which aren't bad, apart from being a bit too shrill in the high end. I use them as stage monitors and run through the PA. Currently the CLR monitors are considered the very best, if somewhat heavy. I have also heard good things about Xitone and Matrix wedges (I'm thinking of getting two FR10s next). While it depends on your budget, you should get the best you can afford, even if you have to wait. However, to temper that, I personally wouldn't get too anxious about having the absolute best monitors available: if they are just for my stage sound, they can be 'good enough', and I will trust the FOH tech to make it sound good.
For dialling in presets, I just got a Presonus Eris 4.5 monitors. They sound good. Headphones sound like crap. Lesson learned.
Some people also use in-ear monitors and have no stage sound at all - I haven't tried this and probably won't, so I can't comment on that. YMMV.
GOOD LUCK.