I suspect your audio is passing out the HDMI port and NOT the toslink to your AVR. Disable the HDMI Audio driver in Device Manager and select your toslink as the default audio. Set it up as 2-channel audio so it will allow the digital stream to passthrough to your AVR; otherwise, the PC will try to decode and you'll only get PCM over to your AVR, not the DTS/DD you're seeking. I too avoid VLC player and use MPC-HC as my preferred stand alone player. For routine playback I use MediaPortal along with either the Win 7 MS decoders, or the MPC-HC stand alone filter for audio and SPDIFER for my audio.