I just got mine today. Mine also had same problem as you described. I solved the problem by jiggling around the "Surround" knob. However I should not have to jiggling around to make it work. I'm still trying to decide whether to return it or not.
Where can I get order just CP-1 cables? That goes to a subwolfer and a soundcard. My daughter's pet chewed up the cables.
I can't find it in klipsch's website.
Thanks for your help