Adaptive optics (AO) systems have significantly improved astronomical imaging capabilities over the last decade, and are revolutionizing the kinds of science possible with 4-5 m class ground-based telescopes. A thorough understanding of AO system performance at the telescope can enable new frontiers of science as observations push AO systems to their performance limits. We look at the understanding we have gained from recent Lyot Project images at the Advanced Electro-Optical System (AEOS) 3.6 m telescope to show how progress made in improving WFR can be measured directly in improved science images. We describe how wave front errors affect the AO point-spread function (PSF), and model details of AEOS AO to simulate a PSF which matches the actual AO PSF in the astronomical H-band. Finally, we estimate the impact of improvements to wave front reconstruction techniques on diffraction-limited coronagraphy with the Lyot Project near-infrared coronagraph.