A general method is developed for analysing the evolution of nonclassical l
ight in complex two-mode optical systems where linear and nonlinear process
es with quadratic Hamiltonians can take place simultaneously or successivel
y. Analytic expressions are derived for the output Wigner function and the
output photon number distribution for a general coherent-state superpositio
n input that can approximate any quantum state of light with a high degree
of accuracy. As an example, the evolution of amplitude squeezed light is an
alysed in a nonlinear coupler with degenerate and nondegenerate parametric
amplification. it is shown that all-optical switching can be realized in th
is system.