I was recently given a Phillips HTS3051B/F7 Blu-Ray Player with surround sound, and need advice from someone experienced with home theater setup. The device has RCA audio and Coax Digital Audio in ports. I am attempting to connect a Sony Bravia TV to the device along with an XBOX360 in the most efficient manner without buying an A/V receiver. Currently, I have connected the TV to the player through RCA audio cables (which simulates the surround sound); however, the TV also has an optical digital audio out port, which would produce better quality. Additionally, the XBOX360 has HDMI out (which would connect to the TV) and an optical digital audio out port. The problem lies with the Blue-Ray Player, since it only has coax digital in capability. However, because it is a gift, I would prefer to keep the device rather than finding one more compatible with my needs. The solutions I have reached are: (1) merge the optical out ports of the xbox and TV and convert them into a coax digital cable to connect to the Blu-Ray Player, or (2) connect the xbox to the TV through an HDMI cable (which I'm not even sure supports audio from the xbox) and then convert the TV optical output to coax input on the device. It appears that the second version would be more appropriate, but I'm not really sure. Can anyone confirm whether (1) either of these options work, and (2) there are any cheaper / more efficient alternatives (besides an A/V receiver or alternative system). Additionally, any direction in terms of affordable products I should purchase along with links would be greatly appreciated. I never realized just how complicated all this home theater stuff can really get, but refuse to allow these incompatible devices to defeat me. Thanks in advance for any help.