I have a HTS 7.1 (setup is probably the same). If its not a setting on the dvd player, I would check your defaults for each source/input. For the dvd player make sure you have gone with digital not analog (none selected). Then check the default mode...dvd...if the default is DPII it won't permit a higher mode. If its set for DD, DD THX, DD THX Movies it will select that if available....it will only select a lower mode (such as DP) if the disc doesn't have DD. Hope this helps.
If not, give Krell a call. They should be able to walk you through it.
If not, give Krell a call. They should be able to walk you through it.