Ambisound surround is not automatically selected when using multichannel, even if 'AUTO' is chosen and a DVD played. i.e. the Ambisound logo does not light up during DVD playback
Check that the DVD contents have been recorded in multichannel (channels 5.1 and above). You can usually find this information on the back of the DVD cover (e.g. Dolby Digital 5.1, DTS 5.1 etc).