Got things working for the most part. As for the multi-room function, it does appear to allow for different audio sources. You click multi, wait a second, select the source, then wait a few more seconds, then select the volume. It also looks like there's a way to pre-set the multi room volume in the settings.
I also found out that the rear speakers remain on when multi room is enabled.
I only appear to be able to get multi room output when my source is the DVD player. The DVD player is connected via a left/right audio out, to the DVD stereo/analog in on the SR 7001.
It makes me believe the SR 7001 only allows for multi-room when the audio source is analog.... I really hope that's not the case. Can anyone else confirm this?
I also went into the multi-room settings, under preferences, and changed the audio from stereo to mono, no difference.