Setting up a new Receiver to HDTV

If I have posted this in the wrong place please let me know. I apologize if I did.

Hi folks. I sure could use some help. I had an old 1980's Yamaha Receiver with Dolby. I had it with a TV and DVD Player connected to an AT&T Uverse through their DVR. My TV is a Sharp Aquos "LC-40E67U".
I purchased a Yamaha HTR-6240 Receiver. When AT&T originally connected it up, it all went through my TV with only 2 Componenent Plugs Red and Blue running to the TV's "Output" to the old Yamaha's CD/DVD Input.

I was told to do it the same with my new one with a few different changes. I wanted to use my Component Plugs instead of HDMI Plugs.
I connected a "Digital Optical Cord" from my DVR to AV1 on my new Yamaha HTR-6240. My DVD has no HDMI just an "S" Video which I was not using. I ran my Audio and Video outs to my Aquos. I added an "Orange" Composite Plug from the Orange Plug on the DVD to AV2.
I did not know until now that you can set your DVR to "Dolby". Mine had been set to Stereo. I changed to Dolby.
After changing to Dolby, I could only use my AT&T Remote to adjust Volume on Non HD Channels and the sound was barely audible which caused me to have to crank up the Receiver's Volume. The AT&T Remote would not let me adjust the Volume on HD Channels. I had to use the Yamaha Remote. Also in Dolby there was every 30 minutes or so the volume for a 100th of a second would go out.(about as long as a snap of a finger) It was minor but a bit anoying. AT&T told me that was their problem and that they were working to correct it. They suggested I switch back to Stereo on the DVR. The Receiver is a 5.1 but I am just running it on Front Right, Left and Center speakers.
When I switched back to Stereo, the Volume on Non HD and HD volumes were the same and I was able to adjust both Non HD and HD channels with the AT&T Remote.
What my question is, is there a way to operate the Receiver in Dolby via the DVR and have the Volume levels the same and allow me to adjust the Volumes with my AT&T Remote on both Non HD and HD Channels if I switch the DVR to "Dolby"? Also, since this Receiver has a lot of different Dolby and "DSP's," even in stereo, would it give me a Dolby type sound. Any help would be appreciated.
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More about setting receiver hdtv
  1. you can hook left right audio with RCA plugs, but it won't be true Dolby, only simulated.
    as far as the rest of the answer, try simplifying the question, too many details that confuse the issue. Unable to make a logical response.
  2. Basically, what is the best way to connect this up so I would be able to use the "Dolby" setting on the "DVR" and be able to use the AT&T Remote on HD Channels which I can't, when the "DVR" is in "Dolby Mode" and correct the large discrepincy in sound when I am watching the Non HD Channels when the DVR is in "Dolby Mode".
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