I do not understand this board sometimes. Everybody blasts Nintendo for not being sony/Microsoft but when they blast Nintendo for doing something sony or Microsoft would do they get blasted anyway.
Nobody remembers how the only high quality audio that came from the ps3 required your receiver to support something specific that not all did?
Also Could this be a limitation of having to stream audio to 2 screens at once? I would think having to stream optical out to a receiver, hdmi to a tv, and audio to the controller all at once would require a lot of power.
Maybe that's why they didn't include it?
It's about licensing. Linear PCM doesn't require Nintendo to pay a licensing fee to get 7.1 surround. 5.1 PCM doesn't work over optical, it doesn't have the bandwidth so there's no point having that port unless you're doing Dolby/DTS which require licensing fees. Nintendo also removed Dolby Pro Logic support for the same reason. Now why they can't output stereo via RCA and video over HDMI is not an answerable question, it's probably an oversight or something that wasn't a priority for launch.