This maybe a stupid question but I just bought a Pioneer VSX-516-K 7.1 receiver so why does it have DVD 5.1 channel input as well as regular DVD video and audio inputs?
DVD-A and SACD players require analog 5.1 input on the receiver. All SACD and DVD-A players have this 5.1 output to connect to the 5.1 input on the receiver. You can listen to DVD-A's via coaxial or optical audio input but in order to enjoy the true amazing 5.1 sound from them, you'll need to use the 5.1 connection. For example, Blue Man Group - Audio on DVD-A sounds excellent via optical/coaxial input but when I switched my receiver to 5.1 direct mode, it sounded 10X better.
The direct 5.1 inputs should sound better than optical/dig.coax if you have a good dvd player. Instead of sending the digital signal to the reciever for decoding, the dvd will decode the signal and send it straight to the amp for output. Any dvd player capable of doing DVD-a or SACD will have a much better decoder than 99% of the AV recievers.
ps-5.1 direct outs are the ONLY way to get true SACD or DVDA. If your player even outputs these signals through optic/coax then it's not doing so in multichannel format.