Bookworm,
Several errors in your explanation:
1. No such thing as Dolby DTS. They are two different companies that use different algorithms for digital signal processing. There has been an ongoing battle because the human ear "perceives" louder as better. There are other differences as well. Such as Dial Norm, etc.
2. What is DR? Do you mean DNR (digital noise reduction)? Does not affect volume. DN? Dialog Norm?
3. Audio compression affects quality not volume. In compression formats, audio information is discarded that the algorithm feels is unnecessary. Articacts can be hissing, echoing, etc.
4. Stereo is only discrete if that was the original recording format. With 2 channel PCM, the information is combined. PL will recreate the information into more than two channels. Most programming nowadays is recorded in more than two channels. 5.1, 6.1, 7.1 are all discrete full range channels.
S~