There are two audio setting buttons from your audio screen. One is DSP and the other is Sound.
DSP is your surround setting. It's a bit confusing here as the button is either lit or not lit. From my listening experience, it appears that in surround mode, the audio system is trying to convert all signals (even stereo... which is really strange) into 5.1 surround sound (basically center, front, rear, & sub). This means that it will try to filter all vocals to the center channel and will focus all stereo to the front two speaker, anything resembling echo or surround will be sent to the rear speakers. All low frequency will be sent to the subwoofer. If your wondering why this setting is even here, it's solely for the DVD. In my opion it's a confusing setting to have as you can only watch DVD's when the car parked. (..and yes I know about the work around. I already did it to my car for the bluetooth phone settings.)
The Sound menu is where you will find bass, treble, and midrange settings in addition to balance and fader.
If your still confused on the settings, please check your owner's manual in the audio section
As for the comment on the subwoofer bass, I find it's nearly non-existant at lower volume levels. When the volume is increased, the sub starts to kick in. (I'm talking about volume levels at least well into the 30's). I personally like to keep the volume in the lower twenties for my average everyday listening, so I don't really hear much of the sub at all. However, when I get in those moods and turn it up, that's when I realize that there is a subwoofer in this system.
As this is my first experience with the ML system, I can't comment on how it compares to previous Lexus ML systems. I would think however (from my past audio experiences), that previous systems would have sounded better, just from the sheer fact that its a simpler system... just making CD's sound their best. Adding DVD surround playback to the mix means that speaker/amp selection and settings in the current ML system was a compromise to get the best overall appeal to support all of its features.
I hope this helps.