Forgive what might be a foolish question, but when is your 981 (or even a 980) ever going to have a 7.1 source? I thought 7.1 exists only on the new high def media formats. The most I've ever seen on a DVD is 6.1, and the digital connection (HDMI) can handle that. I wouldn't even worry about it.
As to using your Oppo's or your receiver's scaling abilities, try both and use whichever you like best. Odds are it'll be your Oppo, so set the receiver to pass-through or whatever the term is. But still, try both.
cheers,
supervij