I have the 661 with 7.1. It is true that the 7.1 mode is set to auto by default, meaning that you have to go in and set it to on after you power it on if you want 7.1 from 5.1 sources. It is stupid, but not that big of a deal once you get used to it.
All you have to do is a couple of remote button pushes (watching the front display on the receiver if using HDMI, watching the screen if using less than HDMI). It's basically pressing menu, going to manual setup, then sound setup, then ext surround, then turning it on. From there you can toggle between all the options, but I just leave it on PLIIx. It does remember that part for some reason. I do it about two seconds and it's not a big deal. If you have a universal remote, you can set up a macro.
I agree that it's a stupid thing, but really isn't that big of a deal. Having the receiver now and loving it, I'd but it again even with this little PITA feature. I think the pluses far outweigh this tiny little minus.
And no, I don't work for Yamaha or do I gain any reimbursement from supporting them
Pat