HDMI 1.3 Audio Signal - Good Enough, or no?


I own an Arcam AVR350. As many know, this AVR, among a few others, eschews the HDMI connection for audio (providing switching for video only), citing it as a path largely inferior to other alternatives for truly quality audio reporoduction. Even with the introduction of HDMI 1.3, Arcam stands by the decision they made with respect to HDMI 1.1 and appears to have no plans to accommodate the HDMI audio path in the near future.

My question is whether most folks think that audio quality considerations in a home theater environment are important enough such that the HDMI 1.3 audio route would be "good enough" for HDTV and HD/Blue-Ray DVD. Or, is it really only a factor if you are using the AVR with both an HD cable/satellite receiver AND a high-quality audio source like SACD or DVD-A?
4yanx
When Wes Philips (of Stereophile) watched a demo of an HD DVD with Dolby TrueHD soundtrack transmitted over HDMI 1.3 to a new Onkyo RECEIVER, he said it was the best surround sound he had ever heard.

YMMV, I suppose.

OTOH, you may get pretty close to that with uncompressed PCM over HDMI 1.1.
HDMI doesn't work with SACD I don't believe. But it is the only real way to pass the new hi-def audio soundtracks.
That's what I mean RW - meaning that NOT using HDMI may (or may not) be only important when you are using your AVR in conjunction with, say, an SACD. Also, whether having an AVR which CAN utilize the HDMI audio signal is really anything more than a convenience in using less cabling and whether a sacrifice in audio quaility, if any, is significant.