Gonc- I am planning on using the analog direct-pass all the time for the DVD player and digital inputs for laserdisc player, satillite box, etc. It's important in this context that you know that my surround speaker set up is different than most and was something I had to research quite a bit of research on to figuge out how to do right. Here's what I'm doing. I have 7.2 speakers, but only use DD 5.1 decoding (because I only have 5 channels of the sweet modded amps I described due to cost considerations). The surrounds are located on the side and back (as with 7.1) but wired in parallel (amp to side speaker, then from side speaker to back speaker). This effectively creates a 4 ohm load on the amp and works fine if your amp can handle a 4 ohm load. Key here is that my DVD player decodes the 5.1 signal, adds full bass management and speaker distance settings and the ability to select the position of the surround speakers - which in this set up is "on the side wall behind the listener (i.e. half way between the side and back speakers). It works like a charm to provice 360 soundfield for all 5 channel media. Trade-off is that I don't have discrete back channel for EX discs (but I'm willing to live with this).

I agree with you that some A/B testing with the digital input and different surround fields that the 970 offers is needed and will give this a try and let you know how it goes.