I’m just learning this stuff myself, so take this with a grain of salt. I may be out in the weeds with this…….
Digital information is stored on disks in a compressed format (sorta like a zip file). A decoder is then required to unpack this information and send it to the digital to analogue converters. (this is where you see brand name DAC’s referenced, such as Brown Bur or Crystal or Wolfenstein). The decoder and DAC’s can be either in the player or the receiver.
In regards to the multi channel analogue outputs, the player does all the decoding and digital audio to analogue converting. This bypasses the circuitry in the receiver that handles digital information. The information has to be digital for the receiver to apply any type of surround matrixing. Some receivers can convert these analogue inputs back to digital and then apply EQ and / or surround matrixing to add additional channels. HK’s can do this, but I’m not sure about Denon. I suspect that you will not be able to matrix the SB channels.
The Oppo multi channel outputs are for all audio, regardless of format. If you wish to use them, you will need to set up the base management in the Oppo’s menu. Your Denon may have the ability to adjust the channel output levels, but if it doesn’t, the Oppo can.
The Mixed outputs are all channels lumped together to get a two channel output. Not sure, but I believe this in a PCM format. I wouldn’t bother with these unless you are using a two channel receiver.
If I were you, I’d use Optical or Coax unless you have a receiver with HDMI that can process HDMI audio. Be warned, not all HDMI equipted recievers / pre pros process HDMI audio. Many do nothing more than act only as a switch.
