jdsmoothie - thanks for the help - that fixed the problem. I went to that page of the manual and that menu at least 10 times last night and I was sure that the signal could flow through the HDMI cable, but I couldn't get the video to work. My mistake was thinking that RCA meant red/white cables instead of component cables. Having a red/white hooked up to the back of the cable box didn't change the audio signal in from 2-channel when using the HDMI port. My understanding is that it's a hardware issue that AT&T is working to resolve.
Don't want to be a commercial for the U-verse, but I am thrilled with the PQ, sound, features, internet, service, and price. They made my whole house wireless for free and gave me all the optical and HDMI cables I needed. Wish I hadn't bought some before-hand. So far no bugs and very fast internet compared to my DSL 6.0.
batpig, the consensus in the U-verse thread over in the HD Programming forum seems to think that in HD cable's current environment there is no improvement in the PQ or SQ by using HDMI. Is there a reason to use HDMI over component based on the 988's capabilities for upscaling or anything like that? My understanding is that TV can't be upscaled, but I'm probably wrong about that too. Don't know if I will need that HDMI port for anything else anytime soon, but if there is no advantage I might as well leave it freed up just in case. I think that's what jdsmoothie suggested a while back, but if it will improve the PQ, I'm all for using the HDMI.