Ratatouille, why DD 5.1 sounds better PCM 5.1?

[Gizmo99]

Receiver: Yamaha Rx-v1800
Player : PS3
Connection: PS3 to Receiver over HDMI (HDMI 1.3)

My PS3 is set to BitStream in BluRay Audio Setting Menu. Watching the movie in DD 5.1 (turned it on through the BD disc) was much better (louder, pronounced and more clear) than when I turned on PCM from the BluRay Disc. Why is that? I thought PCM sounded much more superior than DD?

However, I tried changing the PS3 setting to LPCM (instead of bitstream) and turn on PCM from the BluRay Disc. The sound was pretty much but not as good as DD.

Outcome:

Ps3 set to PCM + BluRay Disc set to PCM = Pretty good
Ps3 set to BitStream + BluRay Disc set to PCM = weak
Ps3 set to PCM + BluRay Disc set to DD = weak
Ps3 set to BitStream + BluRay set to DD = The best

Question:

When both PS3 and Disc are matched (DD to DD , PCM to PCM). It sounded okay. But what does it mean when its mixed? Ie: when PS3=Bitstream and BD=PCM ? or when PS3=PCM and BD=DD ?


Also, what setting on the PS3 should I leave it to
Thanks