High performance disk files of today are utilizing magnetoresistive (MR) heads to realize significant improvements in areal density. The MR head is a non-linear device which can at best be operated in a quasi-linear mode, The effect of MR induced non-linearities on the recording channel performance is not widely understood. The partial response channel is known to be sensitive to write nonlinearities. In this paper we study the effects of read process non-linearities. We present the results of a combined recording process and channel model to quantify the signal margin reduction of the peak detect channel and the PR4 channel, as a function of various MR induced non-linearities. We find that the traditional measure of MR peak asymmetry is inadequate to predict channel performance.