Get one of the HD setup discs (Disney WOW, Spears & Munsi, etc.) that have a set of audio calibration test tones. You will also need a SPL meter which you can get at Radio Shack. The disc and the Denon manual should guide you through making the appropriate level adjustments on your speakers. Are you using this mostly for music or movies? If it's music, you will want to set it to Multichannel Stereo (or something similar) to ensure you have sound from all 4 speakers.
As for your question about 2-channel, by definition, "2-channel" means only the front left & right speakers, so you would not use all 4 speakers and a sub. "2.1 channel" would be your fronts + sub (and is what many people prefer when listening to music through small/bookshelf speakers unless it is a multichannel source disc like SACD/DVD-A). "5.1 channel" would be a front left/right/center + your rear speakers. It doesn't sound like you have a front center channel, so you would have a matrixed front soundstage (where dialogue would be routed through the left/right speakers in a way that blends at the center of the listening area).