Originally Posted by Beastus
Yes, but it's still compressed audio. You should connect your BD player to the receiver with analog. AFAIK, there's analog 5.1 input on your receiver. That way, the audio will decode in the BD player, and you'll get lossless audio in Dolby TrueHD or DTS HD Master Audio.
Analog connections are not simple plug and play, though, especially with Yamaha receivers. With analog, the sub output needs to be boosted by 10-15dB in the AVR or at the sub itself. But, if you have other digital inputs, you need to do the boost just for the analog inputs. And, that's what can be difficult with Yamaha receivers, many of which lack separate level trims for different inputs.
Meanwhile, although the DTS and DD 5.1 outputs over coax are not lossless, the lossy tracks on Blu-ray are encoded at the maximum legacy bitrates and they sound great. You get much of the benefit of lossless even when using coax. I doubt you'd hear much improvement using analog.
btw, I have a BD55 connected both ways - analog and coax.