Not dumb at all. This whole thing can be really confusing.
All the audio information on a Blu-ray disc, all those little digital ones and zeros, must be decoded into analog information at some point before the info reaches your speakers. This operation is performed by a DAC (
Digital to
Analog
Converter). It doesn't really matter where, between the disc and the speakers, that decoding takes place. The digital info can remain digital and be sent the receiver/preamplifier in digital form, where it is then decoded, or the DVD player can do the decoding and send the info to the receiver in analog form.
Blu-ray digital audio info, for whatever reason (I'm not tech oriented enough to understand why, but I think it's got to do with the size/amount of info that needs to be sent) cannot be sent from player to receiver via an optical or coaxial connection. It must be sent via HDMI. If you have an older receiver which doesn't have HDMI inputs, in order to enjoy the newer audio formats found on a Blu-ray disc, you must have a player that is capable of doing the digital to analog conversion and which has analog multichannel outputs. Plus, your receiver must have analog multichannel inputs.
I have to laugh at the "older receiver" thing. My receiver is somewhere between 2 and 3 years old and, though usable, is now obsolete. I used the first receiver I ever owned for 30 years.
