This feature is known as 'dynamic range compression' and yes nearly all receivers that have Dolby Digital decoders offer the feature. It only works on Dolby Digital.
It reduces the dynamic range (difference between the softest and loudest parts), which brings up the average level. Movies often have a large dynamic range from barely audible dialog all the way to thunderous explosions. With compression on, the loudest parts are not as loud and because the average level has increased, the low level parts are easier to hear. I use it extensively, although I have an Onkyo receiver, not Yamaha.