I think the problem is in the player, not the AVR. The AVR can only decode what it receives (in this case DD) and it does not have the ability to choose which format the player sends to it.
Edit: On second thought I guess the display may always say one thing (DTS), but the decoder is actually doing something else (decoding DD).
BTW - - Since DD is the core requirement for DVDs, not DTS, any AVR would have to have DD capability, but there is no requirement for DTS capabilty. Most early models of DVD players and AVRs did not have DTS for this very reason, not mention that DTS came a little later than DD.