What is the advantage of bitstreaming the audio vs.sending the decoded LPCM to AVR? Just trying to understand why people care so much about audio passthrough. I'd like to hear a valid technical reason why bitstreaming is supposed to be better than decoding to LPCM. Since Kodi can decode all known HBR audio formats and send LPCM 7.1 over HDMI I don't see a single good reason why anyone should bother with passthrough.
Two reasons mainly :
1. Spatial audio like Dolby True HD with Atmos and DTS:x can't be decoded to PCM without losing the height information - they need to be bitstreamed with passthrough for the extensions to be decoded by an AVR alongside the spatial metadata. If you decode in Kodi you end up with just straight 5.1 or 7.1 - rather than 5.1.2, 5.1.4, 7.1.2, 7.1.4, 9.1.2 etc. you'd get with a receiver fed a bitstream which contains additional audio content and additional object metadata etc.
2. When you bitstream even non-spatial audio, you still pass through additional metadata alongside the audio - containing information like Dialogue Normalisation values, Line/RF mode compression, Centre and Surround downmix levels, Lt/Rt vs Lo/Ro downmix, original mastering information etc. etc. These all provide additional information that can inform processing in the AVR that is just not present with PCM 5.1/7.1. If you output PCM 5.1/7.1 the receiver doesn't receive this metadata. In some situations this may not be an issue - but if you want to do any dynamic range processing, any down- or up-mixing etc., or want to follow the Dolby spec properly, then PCM won't help.
(The above talks about both Dolby E and Dolby Digital - but gives a good overview of the use of metadata)
In some ways you can think of some of the DD metadata as a bit like the HDR10 metadata that is used with HDR video - it provides the output device with more information than just the picture or audio samples that let output devices optimise things based on information from the person who mastered that content.