Yes, this stuff can get complicated but Onkyo manuals are the best I've seen (I buy Onkyo too).
Have you assigned the HDMI input to the DVD input selector? See page 45 of the manual and then do the digital input assignment as well (page 44).
Just FYI, things like digital audio (coax or optical), component video, and HDMI must be 'assigned' because they are not under any given input and can be assigned to just about any input except tuner. You basically have to tell the receiver that when you press the 'DVD' input selector, it should look for the audio at the HDMI 1 jack; that is if you connected the HDMI out of the DVD player to the HDMI 1 input of the receiver.