Squeezebox touch volume question?

I have a question to those who are using the Logitech squeezebox touch. Just got one today and hooked it up to my Home theater receiver using the digital coax output. The Touch will mainly be used for Pandora and the like. I notice that that the volume of the touch is active even though connected digitally. Is that normal? Is there a way to disable the internal volume so that only the receiver volume is active. If not, at what volume is it recommended to set the touch at, all the way up to get it out of the way or set half way up or so. Any info to get the most out of the Touch as far as sound quality goes, besides adding an external Dac.

Upgrade the firmware via Soundcheck-audio instructions. You will have the option to disable the volume as well. Send me a PM and I'll give you the link.
You don't need Soundcheck for this. (Although its very good as well but overkill for this need). Under the Server Settings, go to Player then Audio menus and you will see the volume control which can be set to variable, or set to 100%.
This may be crazy, but I opt to sey my Touch's volume at about 87 percent because this allows me to keep the volume of my preamp "opened up" a bit. If I set the Touch's volume at 100 percent, I have to keep my preamp volume lower, and I just don't think this sounds quite as good. Could be in my head, but I would experiment a bit before I would "set and forget."
Well, go by your ears, but AFAIK, the SBT volume control is a digital volume control, meaning that it discards bits to attenuate volume, reducing resolution as you reduce volume. Does your preamp offer the ability to adjust the relative level of the inputs on the preamp? Some do. If so, just pot it back a bit, and you can use the SBT with the 100% setting, and full resolution.

Most recently developed digital volume controls don't discard bits until you get below 80 percent, I've been told...though I don't know if this the case with the SBT. As you say, though, the ears are the best guide. I may experiment a bit more.
Vhiner - you could be correct about this. I am hardly a techie. Perhaps someone on the Logitech forum boards could answer this for you definitively.