Yeah, night mode reduces the dynamic range. This is the difference in volume of the quietest and loudest sounds, not the frequency response. AFAIK it will reduce the range of all frequencies the same because they all should have the same range. There is off and 4 levels of compression.

I'm a little fuzzier on theater compensation, but it's meant to compensate for extra treble that may be present in some recordings meant for larger spaces (such as a theater). I think having the extra treble can also help those sounds play through an obstruction (such as a projection screen). It's probably not needed in most cases.