The right-hand and left-hand drivers both get the same signal (the middle driver is the tweeter, which handles the highest frequencies). A burning smell from a driver sounds like a significant failure. Did the left driver still work? If not, I'd suspect a failure in the crossover network, but if it still worked than it was just that one driver that died.

I don't see how it could be a bad channel in the 990 - the 990's only a pre/pro, with the 7700 actually driving the speaker. The person on Polk's forum may have been thinking that the 990 was a receiver with internal amps. To a certain degree, anything is possible, but I don't see how the 990 could be responsible for blowing one of the drivers on a speaker.