Hey Garcianc2003,
I'm not sure about the answer to your question, but I had what I thought which would answer my question: I tried FM radio. I am able to switch among various modes including plain stereo, but still no 5 channel stereo.
Since there is no HDMI or bitstream involved in FM radio, I don't see what I could be missing.
I don't plan on using this mode except for possibly radio and CD listening. I want to make sure that I'm not overlooking something painfully obvious on my part before I point my finger at the 970.