If I select PLIIx as a surround mode, I assume I lose the lossless DTS or Dolby mix? I can use PLIIx for regular (standard definition) DVDs also, correct?
No. Pro Logic IIx is applied after decoding - whether it is decoding DD, DTS, TrueHD, DTS-HD MA. It takes the multichannel PCM data produced by the decoder and applies the PLIIx processing to that. You can use PLIIx with DVD and Blu-ray.