Joe, just give it up.
That $40 switcher won't decode DD, DTS, tune in FM and AM, do bass management, and have several self-contained amplifiers, not to mention remote control to tie it all together.
I took a lot of time trying to explain the situation to you yet you still want to place the blame for his lack of knowledge, and possibly yours as well, everywhere except where it belongs.
It says EVERYWHERE, quite clearly, that it supports HDMI switching, not processing.
And, yes, it can be very useful in the right hands. You've been told, several times by several people, how this receiver can work for him and would be useful to others.
Face it. Your buddy overpaid for a BOTL receiver not understanding what he was buying. That's all there is to it.
He bought a hand saw thinking it was a sawsall. To then complain that it doesn't do what a sawsall does is ludicrous. The lack of expected functionality isn't the hand saws fault, nor is it that of the people that made the hand saw. The blame is with the purchaser.
You both should take this as a learning experience, not try to shift the blame to where it's not warranted.
And, don't give me any of that "$1500 receiver" excrement! You yourself said that for a few dollars more he could have gotten exactly what he wanted!