Many SACD players will not output any digital audio signal when playing SACD's (my Yamaha universal player is this way), which is why the DVD input came up empty for you. The 7.1 direct input is a separate input from the others, but I don't recall if it is included in the scrolling list of inputs available from the front panel. I have only used the remote to select it.

The 990 sometimes has troubles with mistakenly identifying surrounds as large - some folks have overcome this by playing with the placement of the microphone.