If you’re using the RCA analog outputs the processing is likely being handled by the Blu Ray player so any AVR will work.
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Hey. So the big benefits are discrete multi-channel sound, but most DVD/BD players will downsample to 2 channel audio.
There have been multi-channel DVD/BD players, but you still need a way of playing all those channels (5.1 or more).
So, if you want to experience any benefits from DTS-HD or TrueHD you are going to have to step up to at least a HT receiver and the HT speakers to go with them.
As far as I know, the specific surround sound formats that you are referring to: DTS HD-Master and Dolby TrueHD is only available on Blu-Ray Discs (I could be wrong about that, I did a quick search to see what surround sound formats streaming services provide but could not find a definitive answer in my short search).
Blu-Ray Disc players can either send the format through an HDMI output or through analog outputs (5.1, 7.1), which means it is performing the decoding within the Blu-Ray Player.
On the other end, you either need a AVR Receiver that does the decoding (as you mentioned) or a soundbar that performs the decoding.
Most new and older AVR's in the past 10 years can perform the decoding.
Probably most soundbars also.
Passive Soundbars will depend on external decoding, like from an AVR.
Most common soundbars will do the decoding as they will have an HDMI input.
Passive Soundbars are more rare from what I have seen.
You're question about how you can tell which one does the decoding, well if you are buying a new AVR or Soundbar, it should state if it does or not but as I mentioned, most do.
Hope that helps.