AVS Forum Special Member
Join Date: Mar 2009
Location: Visalia, CA 93291
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Use an optical / toslink cable from your TV to your Receiver, and connect the WDTV to your TV via HDMI. My parents have a 5.1 surround sound, and their receiver doesn't have HDMI. So, I hooked up their receiver to only handle sound. All their devices, cable, blu-ray player and WDTV2 are connected to their LCD HDTV via HDMI, and one optical cable from the TV to the receiver.
Optical cable (toslink) are capable of 125 Megabits per second. So, bandwith is not a limiting factor for optical cables. However, both optical and coax cable adhere to the Sony Philips digital interconnect format, or S/PDIF. The S/PDIF spec was made to standardize consumer electronics, but now acts as a bottleneck for new formats.
The S/PDIF spec is limited to around 1.5 Mbit and can transfer 5.1 channel Dolby Digital, 6.1 channel Dolby Digital EX, 5.1 channel DTS, 6.1 channel DTS-ES (matrixed or discrete), and 2 channel uncompressed PCM.
Optical / coaxial cords will not give you 7.1 channel audio or any of the high definition audio formats such as Dolby Digital Plus, Dolby TrueHD, DTS HD, DTS HD MA, Multi-Channel PCM.
Hope that helps.