Ok, he NEEDS a component video cable on the Directv receiver, s-video will not give him HD and he might as well throw that cable away. There's no compromise here. spend a couple of bucks and get him one. His DVD player COULD use the S-video cable but he'd be better off with a component video cable there also.
In the Menu button / Help & Settings / Setup / HDTV / Video / Native,,,, make sure that's on(click the box, you only have an on/off selection) This way whatever channel he selects, the resolution will automatically be set.
While he's in HDTV he should srcoll over from Video to TV Ratio and make sure he's clicked onto Widescreen 16:9. he can then scroll over to TV Resolutions and check off the 480p and 1080i. Leave 480i and 720p unchecked. Any standard digital channel that is in 480i will look better in 480p, trust me on this.
With the resolution in Native, if he's on a standard digital channel, he'll have a full picture. If he's on a HD channel, he'll either have a HD picture in letterbox format or if it's not a HD picture he'll have the white side bars which is actually a 4:3 picture in letterbox format but it'll still be a better picture because of it's higher resolution. Oh yeah, if he doesn't like white bars, he can change the color by going Menu /Help & Settings / Setup / HDTV / Video / Bar Color / click the box for a choice of black, dark gray, gray.
This should straighten him out somewhat.

Cheers,
Robin