I remember writing a paper on this 20 years ago when I was at sixth form... I can't believe it's taken that long for the country to even be able to consider an alternative system!!
AV is not a pure system of proportional representation, but in my view it certainly reflects a fairer representation of the electorate's wishes. That can only be a good thing, even if it leads to more hung parliaments and coalitions (and lets face it, whatever you think of the present coalition, we wouldn't be having this referendum if it were a solely conservative government!).
The current first past the post system hasn't served the country well at all. It favours the big parties, and that's why politics in the UK is dominated by labour and conservative.