Hi, my families HT system consists of a Sony 100wpc @1 khz 0.7% THD 5.1 surround receiver w/ DTS and Dolby5.1 (300 bucks) and a Toshiba 4700 DVDP/DVD-Audio player (also 300 bucks).
I currently have the two connected via coaxial digital. Back when I bought the system I had no concept of the differing qualities of DACs, so I figured connecting them digitally was best.
However, I now believe that the quality of the DAC in the Toshiba is higher quality (192khz, 24 bit if memory serves) than that of the Sony reciever. My question is should I connect the two via "multi channel in" rather than digitally, and would I see an improvement in sound quality.
Another thing to consider is that while the Toshiba has a built in Dobly Digital Decoder it does NOT have a built in DTS decoder. Therefore I would be sacrificing the ability to play DTS soundtracks while at the same time gaining the ability to play DVD-Audio tracks. Sound like a good trade?
Also, due to the fact that I would need three pairs on ICs for connecting through multi channel input, I would probably not use anything more highend than RS Gold Series, if that makes a difference.
I don't think you need to worry too much. Unless you have a dedicated home cinema room laid out to optimize sound and you've aligned everything with a calibration disc and SPL meter you probably won't be able to tell the difference between the two anyway. Until you start spending big bucks on decoders/power amps you may as well use the coax. I do.
I would get some cables and try the 5.1 connection from DVD to receiver. You just might like it this way better than the digital only connection for DD.
(I did with my DVD-A player)
I would leave the coax in place for DTS movies.