1) I don't have the answer, but seems this topic was discussed recently on another thread, I'm sure someone will chime in..
2) Mine does that as well, it is normal. Don't have the answer as to why.
3) If you have the receiver set to "no" center, the front left/right speakers give you the center experience in what is called phantom mode. Actually, if your sitting in the sweet spot, you should not notice a difference in dialog from when you get a center channel. When you start to move off to either side, that is where the phantom mode does not work as well.
You should be using "standard" mode which would display Dolby Digital, or whatever the standard movie track is set for...