synth:I was under the impression the DVD1 can only be controlled by the Beo4 remote - and only through a B&O tv. Is that right?
It was designed for the Beo4, but in a pinch a Beolink 1000 would do (with some odd key combinations). Beo5/6 would obviously work as well. As far as I know the DVD1 doesn't have a remote control receiver at all, so it will need to be connected to a B&O TV for that.
synth:I know you can tell the tv it has a DVD player on AV3, however I also notice that there is a V. MEM setting which is designed to tyalk to B&O gear - so would I set AV3 to "V.MEM" as its a B&O DVD1, or would I just set AV3 to be "DVD"?
DVD is the correct choice. The TV and B&O sources communicate over the SCART connection, but the system isn't intelligent enough to figure out what is connected where - you have to tell the TV that first. After that, you don't need to remember nor care which connector is connected to which source, you simply select the source you want to watch.
B&O doesn't need to tout backwards compatibility much, because mostly things "just work" - I believe you could take a Beocord VHS 91 from 1986 or so, connect it to your TV and control it just as easily as the DVD1.
"Fully wired" means just that. If the cable is exceptionally thin, it might not have everything connected.