Pioneer Elite BR on non HDMI Rotel

I am considering getting a pioneer elite 23FD player. My understanding is that my Rotel 1057 reciever has DTS 24/96 built in and is used over coax or toslink. First question is whether or not this is a surround sound format or only two channel? If it is a surround format would it be better to use the coax digital connect and watch movis with the DTS 24/96 or to use the 5 analouge cables? Last question would be if the DTS 24/96 is the way to go then would there be a sound difference between the pioneer elite and a more basic player at DTS 24/96? Since the decoding for DTS 24/96 is not done in the player but rather on the receiver.
What about picture quality at 1080i?
Not sure if this helps but I use my pio bdp-05 bluray player as the decoder for the true DTS-HD audio and run the analogue cables to my CJ multi channel pre with great results.
One of the pleasant surprises for me has been the astounding audio improvements with the new formats.
May want to check which formats the bluray player will decode, ie master dts-hd.

As far as 1080i vs 1080p, depends on your tv size.
With my 60" Pio 151 plasma I get direct tv hd in 1080i and it's very good, but the 1080p is better with bluray player.
Tho over time I tend it take it for granted.

hope this helps some.