Tom, as has been said, Audyssey measures the frequency where the speaker is 3dB down in its particular location in the room. The receiver then uses that measurement according to its own standards to either set a speaker "large"(full frequency range with no crossover)or "small"(a specific crossover frequency between it and the sub or main speaker handling the low bass). If there's a sub, it isn't "sensed", rather the owner manually sets the receiver to indicate that a sub is connected. In that case all the speakers will have crossovers(if a special "plus" type of setting is selected though, the mains will play their deep bass along with the sub, rather than being crossed over to it)and any LFE in movies will be played by the sub rather than the mains.
In my room my M22s measure as justifying a 60hz crossover, but I set that to 80Hz instead, to give the EP500 more work.
