I am getting conflicting information from Pioneer email customer service and the service center folks.
After a couple emails I asked the customer service person to be more specific as to what the Firmware update he was talking about was supposed to do, here's what he said.
The firmware update you can translate how ever you want but this is what it shows. Firmware update V1.004 Problem: Dark Image when using Composite/S-Video/Component inputs (analog signal to HDMI) convert to HDMI Output. I suggest if you have issues to call customer service at 800-421-1404
I then asked why I would call customer service if he was customer service as his signature said? He told me
All I handle is operations and installation of the product. Customer Service handles all complaints about the performance of the unit. If it has a malfunction and we need to investigate to find out the cause and a remedy that is what they would do.
So I may try to give customer service a call and see what the story is. Either way if I keep this unit, it looks like my week old $1200 receiver will need to spend at least a week in the shop! Crazy.
The service center guys who took my model and serial number and researched what fixes were available for them to get after I told them Pioneer said I needed to get a firmware upgrade, told me that there was no firmware upgrade available - but did I use the HDMI plugs? If so then there is a PCB that could be replaced - and yes everything we talked about was under warranty.
At this point my DVD player is going into the 82 dvi to hdmi in and optical cable for audio. Everything is great.
My Sony HD Tuner/DVR is going direct hdmi to hdmi in and while there are some video issues with some 4:3 standard TV broadcasts, I can't be sure that the station isn't partly to blame because others are flawless. However in all cases the audio via HDMI is very low compared to all other input sources. Also if you switch the 82 away from the Sony HD unit and then try to go back it sometimes captures the signal and sometimes can't seem to get a lock and the HDMI light flashes. Turn off the Sony HD Tuner and turn it back on and all is good again.
The Dish Satellite receiver, the Xbox 360 and the Gamecube all sound fine going through the receiver but the video is just horrible. Either completely out of scale or just really blurred and dark for lack for the proper terms. So the S-Video from the Sat box and the component video from the gamecube (480p) are back routed directly into the TV. The XBOX 360 is component in to the 82 and component out to the TV the HDMI conversion just kills the sharpness and some of the aspect ratio of the Xbox games.
Seems like a lot of compromise for this price. I am still wondering if I'd be better served going to a more audio only surround receiver and put all video back directly into the TV. I was running out of inputs on the TV and the best is a single DVI in so I liked having the option of putting things into the receiver.
Well this was a long post but perhaps others are having similar issues and might gain something from it, or better for me have a suggestions as to how I might better configure things to work correctly.