BINGO!
Thanks for the TV tip, I did have it on Variable instead of Fixed,
I was more concerned about the connections and preferences on the receiver than checking the TV options.(.....daaah!)
If someone hits on this thread for the Onkyo TX-SR502 - HIGHLY recommended this receiver. I was himming and hawing on the SR702 ($680) and SR602 ($425) but I can't get into the 2 zone thing since I have two other stereo recievers (also Onkyo, ancient TX-17 and TX-38 - still sound great) in other rooms and the SR502 does a heck of a job on the DVD sound. Had a Sony DE345 that died after 4 yrs, bad main board.
Thanks for your solution!