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S/PDIF only carries either 2 channel audio (PCM) or 'data' usually in the form of multichannel DD/DTS. Since game audio isn't DD/DTS this means only 2 channel audio can go over a S/PDIF from games.


The only exception to this if you lossy compress the audio to DD in real time. AFAIK, the only ways to lossy compress to DD in real time are with some motherboards from Nvidea and some newer ones from Intel, and also perhaps by using a piece of software called ac3filter which is supposed to be able to encode to DD in real time. Note that lossy compression, like going from wav to mp3 or from multichannel audio to DD, brings down the sound quality.


Edit - oops, Chad beat me to it! :)
 
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