No, the video will not pass through the 970 when it is turned off. The 970 must be on to get any video switching.

It's often counter-intuitive to home theater newcomers, but it's actually much more difficult to set up a system that will allow you to still watch TV when the receiver or processor is turned off. Many people take the approach of wanting to be able to "just turn on the TV" and watch TV without firing up the entire system, but the cabling necessary to do this and the control involved is really a huge headache compared to just turning the receiver or processor on.