You are correct. Dividends reported on Schedule K-1 (1120S) Line 16D affect your basis in the stock and are not taxable unless they exceed your basis (the excess is a capital gain). Ordinary Income (Box 1) from a K-1 is taxable, however.
The Section 179 Deduction from Line 11 may be subject to limitation and, if so, is being carried over to be used in a future year. Look at Schedule E (Form 1040) Line 28 Column (j) to confirm the deduction has been reported and how it's being used on your return.
For specific information on items reported on Schedule K-1, see IRS Shareholder's Instructions for Schedule K-1 (Form 1120-S).
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