Why is it that if I change built in flash setting on camera to ETTL, the flash fires when I stop down (which I thought fixed my problem) but the photo is totally under exposed?. I thought the yn560 is a fully manual speedlite.
You are mixing Canon's coded light pulses with Yongnuo's simple optical slave system, and they are not compatible. The YN-560 is firing when it see the series of flashes from your camera but it is either firing too soon or too late to be visible in the photo. (probably too soon)
When you change the aperture, the coded light signals must change as well so that probably explains why you are getting variable results.