I can't answer your question on your sat reciever but the issue concerning cd play back is common. I've read many posts on different forums all complaining the signal dropout when using a digital connection. When I bought mine this was no concern to me as I planned to use the analog connections.
I at first bought the T762 and a C541i because both had HDCD decoding, but have found other formats such as XRCD,K2 and RVG edition disc's to be quite good. Besides my new CDP JoLida 100 does not have HDCD.
Good Luck