i use the dac1 pre in my 'home theatre', well its a small bedroom rig, where my only speakers are audioengine stereo (2.0) A5's
i dont require 5.1 in my room, although the main living room has 5.1 speakers in.
i am feeding my freesat box, my Archos 7, my samsung LCD and blu ray player all to my dac1 via stereo analogue inputs. as all of those devices are HDMI, i simply output one analogue RCA connection from the TV which gets its feed from all the other devices, into my analogue in on my DAC1 which gets fed out to my headphones and speakers.
also feeding it my music devices: rega jupiter, SPL phonitor, off ramp turbo 2, sony D-VE7000S
no idea how people that need 5.1 are utilizing it, m,y guess is they are using it as an input/output 'switch' for multiple devices
but if you are a fan of stereo, then its great