Hook up Plasma TV to Audio system

I had the exact same issue nearly a year ago when i purchased my tv. Only the cheapest models offered analog outputs. None of the tvs with optical outs offered a dolby/pcm conversion option. To make maters worse digital broadcast is now all in Dolby 2 or 5.1.

To solve the problem I picked up a used ht processor for 65$. It works great for processing the tv optical signal, but it won't win any prizes for high fidelity. still it is certainly better then the processor that are built in to the cheap tvs and is better then rat-shack crap. The unit is a technics sh-ac500d.

I have it set to down mix 5.1 to 2 channel stereo.

I wasn't able to find any other solutions, and I must say i am quite satisfied except that the device looks really ugly in my rack and takes far too much valuable space for what it does. I hope this helps.

To the OP: Do you use any other sources to watch TV (e.g., Blu-ray) other than the cable box/DVR?

Nick_sr's solution is the most complete. Any surround processor that supports Dolby Digital surround and has a Toslink input will solve your problem. And if you add other video sources such as Blu-ray, you can use the Blu-ray's Toslink output and connect it to the surround processor as well. And as Nick_sr said, configure the surround processor to downmix everything to 2-channel, feed your TAD the analog 2-channel output and you're good to go.

Even though the DVR has an HDMI output, it almost certainly also has an analog stereo output. You can run the HDMI cable to your TV for best picture and the analog stereo output to your TAD for best sound quality. In this case turn your TV's audio off. And if you have or plan to add Blu-ray, every Blu-ray player I've ever seen also has an analog stereo output. In these cases (DVR and Blu-ray) the stereo downmix has already been done before it goes to the stereo analog outputs.

To Johnny's point about the blu-ray player, I only decode the tv signal through the processor, everything else passes through my Cambridge bd751 universal (blu-ray) player. It has a dedicated analog stereo output. I use it for blu-rays, CDs, dvda, and high-res music flies as well as to stream youtube and networked media files.