Can anyone verify that the Integra DRX 5.4 "Direct Mode" is indeed "Direct?

That’s frustrating and sorry I don’t have the answer, but I will say the bigger picture here is that if I had a nice turntable and a tube phono pre I wouldn’t want any of it running through a mass market AVR at all.  Whether your AVR’s inputs are digitized or not is, relatively speaking, a small rounding error in the context of overall sound quality.  The preamp section and amps in your AVR are not good as with almost all AVRs with their poor power supplies, parts quality, etc., so any “pure direct” mode is like polishing the turd — might make it sound a little better on the fringes but it’s still a turd in the relative scheme of things.  Your analog front end is crying out for a good dedicated stereo integrated amp with a home theater bypass input that you can connect to the front L/R pre outs from your AVR so that the Integra is completely out of the signal path when playing vinyl or any other higher-quality 2-channel sources.  My advice would be to save your shekels for a decent stereo integrated amp as your overall sound quality will take huge leaps forward rather than worrying about whether your AVR’s inputs are digitized or not.  Sorry I know I didn’t answer  your question but was more hoping to provide some perspective and give you a potential upgrade option to pursue in the future and hope it’s somewhat helpful. 

not closer as a characteristic, 'closer to', as-in 'truer' 'unmodified', bypassing any tone circuits, ignoring any pseudo surround added mysteriously, could be a very distant sound as 'originally' recorded/encoded.

I often change my Sony AVR from ____ 'whatever it chose for the devil knows what reason' to Direct, and it sounds better. Other times I choose 2 CH, and that sounds best.

It has nothing to do with A/D D/A conversion, that is a separate issue, I cannot help you there.

@soix

This is not my main vinyl listening setup. In the past year I purchased a brand new system top to bottom. The TV got kicked out of its space. So I am putting a home theater in the basement for the TV. I totally agree with you that the separate integrated with pass through would be the real way to go. Ironically, I have the perfect one for the job. But it is in my main vinyl system and isn't going anywhere.

I had my old TT/Phono pre. So I thought that I would put it downstairs with the home theater rather than having it sit around and gather dust. I don't have the space for a second turntable in my vinyl listening room, or I would use as a second turntable. So I don't expect much from the home theater amp. But it would be nice not to have to send it through needless, pointless, digital conversion, which can only serve to degrade the signal further. Maybe someday I will have the cash to do it properly, as you have stated. Which is the only sensible solution. But in the meantime.....

Got it.  Frustrating that it seems so difficult to get an answer to such a simple question and certainly doesn’t speak well of Integra’s customer support and hope you get an answer from somewhere eventually.