Denon Link is Denon's proprietary way of passing digital audio signals between its components. You don't need an S/PDIF (coax or optical) interface or an HDMI connection or whatever to do this. Any company can come up with their own solution for passing these signals between components. Because it's proprietary, I'm sure that you aren't going to find any technical explanation of how it's done (if that's what you're looking for).
The benefits of using it are full bass management for all source material - DVD, DVD-A, SACD, etc . . . everything stays in the digital realm.
