Welcome to the forum, Paintman!
I'm almost positive that you're right - you can't watch video or hear audio that is being routed through that receiver without having the receiver on. If memory serves, you can run everything through the 1018 and have it pass the audio coming over HDMI on to the TV (you need to select that, and it would not play the audio through the speakers connected to the receiver), so you could watch and listen to your TV like normal - you would just need to have the receiver powered up.
You can also connect the gear straight to the TV to bypass the receiver. Depending on your TV, you could then run a digital audio output from the TV to the receiver. You can't get the latest lossless surround sound formats through optical or coax digital audio connections (you need an HDMI connection), but you could get everything else.