My Onkyo has the feature of assignment of sound mode for each input selection (and whatever was last used will save it for that input selection, as can certain other settings). It does not have the automatic selection of mode within an input based on the signal itself, it's up to you to determine mode or change as you see fit. Maybe that's a tradeoff for having the avr select one automatically; I don't mind selecting sound mode for tv/movies to suit my taste but for something like the net apps like pandora I just leave it as stereo with the other settings I like (like Audyssey set to music, dynamic eq on, and music optimizer on). What Onkyo do you have?
"I realize that somebody playing free music isn't as commercial as a hamburger stand. But is it because you can eat a hamburger and hold it in your hand and you can't do that with music? Is it too free to control?" - Don Van Vliet (aka Captain Beefheart) discussing commercial success in the music biz