jadejay2 said:
In other words, should I use the DVD to decode (using 5.1 ch. out) or should I send the audio via optical out (digital) and let the receiver to do the decoding.
The age old question.
It comes down to whether the DACS in the player are better than the DACS in the receiver. My take on it is that there is little to no (audible) difference unless perhaps you have very mismatched equipment - like an ancient early receiver paired with a top of line, megabucks DVD player. IMO, the 'sound quality' argument is moot as it will be about the same.
However, using a digital connection to the receiver has other benefits that are often overlooked:
1. Very few receivers offer any kind of bass managment on the 5.1 analog inputs (speaker size, distance, xover) and you must rely on the player for those features or use an external device. Players are almost universally poor in their implementation of bass management. With a digital connection, you get full bass managment and more.
2. Receivers have other features, like Dynamic Range Compression (most only work on Dolby Digital sources) which CANNOT be used if you use the analog inputs. Other similar features like 'CineFilter' (similar to THX re-eq that tones down the high frequencies) also require that the receiver get a digital signal.
3. Some receivers have digital outs so you can send the digital signal to a digital recorder like a mini-disc recorder or some cd recording decks. They will NOT convert an analog input signal to digital and send it out the digital outs.