Hi Tom,
I know what you mean, I have a 3806.
The PURE mode bypasses as much functionality as possible to acheive the best sound quality, the level of items that are disabled is configurable through the cumbersome menus.
You don't necessarily have to go to DIRECT to get 2.1. In fact, if you get 2.1 in DIRECT, you should on PURE... unless there is another layer of settings I'm missing. In the configuration menu, if you setup your sub to be LFE + Main, you should get 2.1 from a 2 channel source regardless of PURE or DIRECT.
The multi channel music is not my cup of tea. I'm not sure who provides the surround modes (Dobly, DTS, Denon), but I believe you'll want to stick with the DTS NEO:6 and DIGITAL DOLBY PRO IIx. I have yet to try them myself to see how well they do with a 2 channel source.... but it appears you are on the right path. It is one of those things that is going to be personal preference... when I briefly tried it I though too much sound was coming out of the center channel.
If your music source supports multiple channels... such as a DTS encoded cd, DVD Audio, or SACD, your receiver should pick up those channels and assign the correct multi-channel mode accordingly.
-James