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>>However, would that be putting too much of a strain on the M22's. I don't see how it would be any different than running the M22's in 2-channel stereo. Help me out here.

Nothing wrong with your understanding. The big benefit of running the speakers in "small" is the ability to sound clean at higher volumes because the lowest notes are stripped off so your poor woofers aren't flapping around trying to repro them. It is exactly like stereo, just that DVDs tend to have a lot more bass on the soundtracks than anything you would normally play on a stereo.

The other issue is that when you set to "small" all the speakers roll off at the same frequency and coincidentally the sub picks up at that frequency -- when you set to "large" then each speaker does its own thing in terms of rolling off the low notes, but you can only set one crossover frequency on the sub so (for example) you will probably miss some content off the surrounds (they roll off at the highest fequencies) and center but have good response on the mains (assuming you set the sub crossover in the 60 hz range. If you set the sub crossover higher then both sub and mains will be running from 60-100 hz and you will get a bit of a bump in the response as a result.

All of the above is grossly simplified and you may find that "large" sounds as good or better, but definitely start with "small" first because it is so much easier to get everything working right...