Let me toss out a less expensive option to the Zektor 7.1 switch that I think might work, since only one of your sources has a 7.1 analog output (the 981HD being 5.1 analog):

Use a component video switch or a similar unit to provide 5.1 analog switching between the 981HD and the front/center/side surround/sub channels of the S550. As mentioned previously, you'll be using a combination of component channels, composite channel, and left/right analog channels to handle the six analog audio connections. Then connect the back surround channels of the S550 directly to the 990. When using the 981HD, the back surrounds would appear to be unused channels (similar to what my 983H does when decoding a 5.1 source via the 7.1 analog outputs) - or at worst (if you had both players running at once) you would get back surround data from the S550 and realize that you ought to at very least pause the S550. It's less elegant than the Zektor, of course, but it will also cost several hundred dollars less...

Altec, Scott, or anyone else see a potential pitfall in this scenario that I'm overlooking?