As usual with digital, it all has to do with DACs (Digital to Analog Converters). A player with HDMI out (the audio portion) sends the digital signal unchanged to a receiver that can accept it (with HDMI inputs). The receiver then strips the digital audio portion off and passes the video portion to the TV attached. The audio portion is then decoded if the receiver has the proper functionality. And therein lies the rub.
HDMI is still an evolving standard. When Blu-ray came out, the introduced some very high quality codecs (CODEC is a mnemonic for COde DECode), which allow lossless compression of the audio signal (DTS-HD Master Audio and Dolby True-HD). Dolby Digital and DTS were lossy compression algorithms with less bandwidth and sample rates. As such, they could be carried over coax (or marginally TOSlink optical). Furthermore, HDMI provided copy protection, so it couldn't be directly copied to other disks without being decoded and then re-encoded in some other format. So HDMI provided copy protection and the bandwidth to cary these new high definition audio codecs to decoders like your brand spanking new A/V receiver. But, the receiver needed a decoder and none except for the bleeding edge companies (like Denon) had them. So, market turmoil erupted as everyone dumped their old A/V receivers for new ones that could decode Dolby True-HD and DTS Master Audio (notice the prices on older A/V receivers these days?). There were very few companies that had offered 8-channel analog inputs to their receivers. Conventional wisdom was that DTS and Dolby Digital was enough, but that wisdom was dated, and Blu-ray winning the format war changed the industry.
But I digress. Your Sunfire doesn't have HDMI, so the point is moot. You need 8-channel input to get the new codecs. The Sunfire does a fine job in decoding DD and DTS, but for the new ones you need a good player that both has good DACs to decode the new codecs and 8 channel output to feed your Sunfire the analog audio. That's why I went with the Oppo BDP-83 upgraded to the SE. It has better DACs than the Sunfire, as far as my listening tells me, and full 8 channel output. In fact, if you just wanted to listen to any format disc and not have other inputs, you could use it as your entire A/V preamp, as it has level controls for all 8 channels and bass management controls. Get a Sunfire 400~seven and a True Subwoofer and you'd be all set with the Oppo and a TV.
But your coming TGP-IV has 8-channel input (Bob was smart not to just have digital inputs), so you're all set. Use them, but make sure your Blu-ray player has 8-channel outputs.
It should sound like it isn't there!
There is a difference between hearing and listening...
Making life enjoyable through expensive electronics.
Carver: C-4000 & C-1 preamps, PSC-60 preamp/tuner, TX-11a tuner, M-400 (2), C-500, M-500, M-500t, M-500t Mk.II, A-500x, AL-III loudspeakers (2 pr.)
Sunfire:Theater Grand III processor, Ultimate Receiver, Cinema Grand Signature 400 ~ seven, True Subwoofer Mk. II, D-10 Subwoofer