We have the stereo hooked up to the dynex 42'' tv, as we did our other tv, we can not mute the complete sound and also sometimes we cant turn the volume up and down whats going on?

Since you have it hooked up to the stereo system, you need to go to on screen audio set up and turn off the TV built-in speakers (you will be listening the TV sound through your stereo system speakers), then go to the audio output set up and set it to 'variable' so the audio output of the TV's RCA audio out put will vary with the volume control of the TV (not all TV will alow this function), you will need to set the stereo volume to certain level (around 9~10 O'clock setting) since the sound coming from the TV will be controlled by the TV remote volume control. You can otherwise set the TV output to be at 'fixed' level, which means the sound output of the TV will not be controlled by the TV remote volume control, you will use the stereo remote volume control to adjust the sound level instead. I hope this is clear to you.