Audio & Receiver Help

[SoundFreak]

I finally bought the ps3 mainly for blu-ray but since I'm an occasional gamer, I get the best of both worlds...at least I thought.

So far I've watched two movies and both were in pro-logic IIx. The movie fires up in dolby digital then as soon as it starts, it changed. I have an Onkyo which does not pass HDMI audio. I know this is part of my problem...

However, why wouldn't I be able to pass DD5.1 thru optical? Granted, I did try another movie which seemed to be DD5.1. My best understanding of this is that the PS3 can't decode certain things and especially that I need HDMI 1.3.

So, what do I need in a receiver? Do I really need to buy a receiver after just buying my current one less than a year ago? I have a great setup but now with blu-ray I don't want to have a good picture and bad sound. Watching the movies in pro-logic is painful when your use to a regular dvd with nice sound. I want better sound, better picture which is why I bought blu-ray.

I don't have a ton of money so I was thinking of the new onkyo that supports TrueHD. Reviews are such that the video switching quality is not very good so that's out of the question. Everything else seems like I'm going to need to spend close to $700 or more.

Should I wait? Why are all movies not in DD5.1?? How do I make my current setup DD5.1 always?

I use Bitstream right now? LPCM doesn't seem to help. Either way without DD I can hear my speakers begging for more. The distortion of powerful scenes is not good.