Thats an odd one, Rolando. All the DVD players I have ever owned (Sony, Pio, Denon) give you two choices; PCM or Bitstream. I have never had a 3rd choice, thus I would not be able to guess what that is.
S/PDIF stands for (I think) Sony/Philips Digital Interface. Now, I think I read that somewhere, but if someone chimes in and says thats B.S., I will take my lumps!
EDIT: Looks like I was correct:
http://whatis.techtarget.com/definit...213474,00.html
How that equates to the setting in your Malata, I have no idea.
But the key is that you do NOT want PCM turned on for DTS, otherwise it will be sent out as a 2CH digital signal, and decode into PL, PL II, or whatever else your AVR can do with PCM.
How are you connected; Optical or Coax? If you have both, can you try the other?
BGL