Kray,
A couple of things:
FIrst, I previously owned the Sony DVD-S9000ES and it wasn't that great for redbook CD playback. Although I did not own them at the same time, I believe my current JVS XV-SA602BK that I bought for $125 on AudiogoN is better for CD playback. Now, compared to the dedicated CD players I've recently owned, ALL DVD players I've used for CD playback were mediocre. I would highly suggest the purchase of a moderately priced dedicated CD player, but I'm sure you can get an opposite opinion on this subject too.
Secondly, the HT bypass/processor loop basically bypasses ALL of the pre-amp functions, essentially connecting the L&R output from your HT receiver/processor directly to the amplifier. When the SSP/bypass switch is engaged, your HT receiver/processor will control the volume of your 2-channel system (L&R fronts). It basically turns your pre-amp/amp or integrated amp into a power amp.
Lastly, I don't know squat about the Def.Tech. stuff, so I can't help you there.
Enjoy,
TIC