Will,
When you say "coax from my CD" is that analog rca or digital coax? If that is digital, then all bets are off. The bypass is really short for "analog bypass". It is not intended to be used with a digital input. That could explain the strange results.

But, I do agree that in "stereo" mode (which basically means 2.0 surround mode) the crossover should affect the output of the mains, assuming they are set to small. If set to large, the crossover setting will have no effect.