I have my S-video directly into the TV with my audio outs from the DVD into the TV also. I then run my digital out into the 1050. This allows me to listen through the tv or the outlaw. You don't need to use the video cable that came with your dvd player. As far as I know the outlaw doesn't have on screen display so don't worry about losing it. As for the volume I usually run mine about 46-53db. Alot depends on your speakers sens.
Hope this helps