So, concerning the front pre outs, they should not be used when also using the corresponding speaker terminals. The Grotto manual does mention using them as one connection option using certain receivers but Yamaha advises against it with this particular receiver.
While a handful of receivers can make use of a subwoofer in Pure Direct mode when using the LFE connection, the Yamaha cannot do so. However, the sub can be connected via LFE and used with speakers set at Large in “Straight” mode if “Extra Bass” is turned on as this will duplicate the low frequencies from the front signal and send them to the sub as well.
If movies are being played on this setup, some tracks may prove too much for those speakers set at Large using “Extra Bass” to get a signal to the sub. Many would recommend a Small setting with an 80Hz crossover. But, to each their own.
There are a few options here and it’s fun to experiment. If subwoofer use in Pure Direct mode is a must, I’d set all incoming devices to output two channel stereo(PCM) to the receiver. I would configure the receiver to 7.2 Bi-Amp and set all channels, other than the fronts and sub, to None. Then, connect wires from the Bi-Amp speaker terminals to the subwoofer speaker terminals.This will result in a full range signal being sent to the fronts and sub while in Pure Direct mode and it can just be left there for everything. The knobs on the sub will be used to integrate the sound to one’s liking.
That is just one option and it really is just for playing everything in Pure Direct mode and getting the sub in the mix while doing so. Again, I think many will recommend Small front speaker settings with an 80Hz crossover and subwoofer connected via LFE. It will sound great but will not produce sound from the subwoofer in Pure Direct mode. Oh, and beware the “Extra Bass” feature when speakers are set at Small. Instead of just duplicating low frequencies and sending them to the sub as is done with the Large setting, “Extra Bass” applies a noisy bass boost to the speakers when set at Small.