You are not supposed to get sound sound from the multi channel option when you are playing a DVD player that is connected digitally to your receiver. It does not matter if you use optical or coax to get the digital connection. Your multi channel option can only be used in the following method: Connect 5 (or more if receiver is 7.1) analouge cables to the back of your DVD player using the appropriate RCA Jacks from the section marked,"multi channel out". Then run those five analouge cable to the back of your receiver to the section marked multi channel in. You will know what cable goes where because each RCA jack is labled with the name of a speaker, for example center channel, front right, front left, etc....Just match them up appropriatley, center to center, front left to front left, and so on.
The purpose of multi channel inputs is to keep your receiver from becoming outdated by providing you the ability to add new processors as the needs arise. For example my panasonic DVD player has built in dolby digital, dts, and dolby plII decoders as well as DVD audio. My receiver didn't have PLII so I hooked up the DVD player to the multi channel in and poof: instant PLII. You have to use the same connections for DVD audio and sacd.
Now that I've told you all of this here's the kicker. Your DVD player doesn't have multi channel outs so you can't use it this way. Further more you are getting the best sound you can get with you HT if you use a digital connection from the DVD to the receiver. You would be wasting money upgrading IMO, you won't notice much of a difference. The decoders in your receiver are better then all but pricey DVD players. As long as you are satisfied with current performance don't muck it up. If you are insistant about upgrading I'd suggest the Denon 555-s, on at JR.com for about $100 right now.
