Yes, it does not matter. If you have a disc that has both PCM Stereo and Multi-channel such as DD5.1/DTS5.1, press the MENU button on your RC-1070 (the small remote) to display the surround mode menu while playing the disc in PCM stereo you will see the Neural, DTS NEO:6, Dolby PLIIx modes. Now select the multi channel mode available on the disc and you will see those modes disappear from the surround mode menu. You will see this regardless of whether you player is selected to LPCM or bitstream. If you have a FAT then you can choose to take my words for it or go and buy a slim

or any other player that can bitstream.
I know Denon manuals are not easy to read, but you may want to re-read p.43,44 and 75-80 as AVRaT suggested, for more details. For example, the manual will tell you which modes are turned on and off by speaker configurations. One last point, you should always see 'MATRIX' on the surround mode menu even in . If not, something is wrong.