Here's the picture:

http://www.energenix.com/sony-sdp-e800.html

I'm in the market for one of these and I want to do away with my bulky reciever (it's Dolby Pro-Logic).

My needs are simple:

Want to be able to utilize the optical connection on my DirecTV box and on my DVD player. That's it...just those two connections...

Also, I'll only be utilizing my front 3 speakers (left/center/right) and subwoofer. Their all Sony's...shielded and small...

Will this processor do the trick? I've read that it needs to be used with a reciever? Is this true? I'm not using it for anything other than as an imput for my dvd player/directv box...no tuner needed..don't listen to the radio inside, etc.

Also, where's the best place to find one cheap?

Thanks,
sightandsound

you would have to use that with either a Dolby Digital ready receiver or a pre/pro with a 5.1 input, then routed to an amplifier.
If you're only using the front speaker array, aside from better bass performance, I don't know that you're going to be gaining all that much over DPL.

Your best bet would be to get a new receiver that has both Dolby Digital and DTS decoding on board.

I'm not sure where you'll find separate decoders (other than very high end ones) any more. They've gotten so common in receivers that it's not that much (if any) price increase to have decoding on board.

A good budget receiver I can recommend: the Onkyo 494. You can find them for under $300 at virtually any electronics place (that carries Onkyo)

How about the Sony STR-SL7? Have you heard positive or negative things about it?