I leave my AVR on "Auto" so that stereo source content plays stereo, 5.1 sources play 5.1, and I don't ever use any virtual surround modes (Dolby PLII, DTS Neo:X, etc). Quadrophonic sound is for cars; and using a virtual surround mode where a native surround mode is already provided in the program content seems like blasphemy to me.
Anyway, if I recall correctly, my SR6008 does compartmentalize some of its settings depending on the source. I can set Dynamic Volume to "medium" for the CATV source (to squash car commercials) and "low" for the HTPC source (to avoid waking up my daughter when she goes to bed), and the AVR remembers the difference. At least I think that's how it works, anyway. It seems like I also had to set the LFE volume for each source after running the initial Audyssey sweeps, but I could be mis-remembering that. I've slept since then, and I'm not home at the moment to verify.