Need an explanation

[Iceman_II]

I could very well be wrong, but it may have something to do with how the signal is processed for output. Most standalones are hardware driven, but the PS3 is all about the software and the clock cycles, by not processing the signal for the non-used output, it may save processing power? It could also be that if you are outputing to TosLink a format that the RCA can't handle, such as bitstream, the RCA goes silent... have you tried setting it up for TosLink with two channel stereo? Not sure if it will work, but if you strip it down to the least common denominator, it may work.

When mixing and matching audio outputs, strange things happen, when I have the computer hooked up to speakers, it works fine, but when I hook up via TosLink to the Stereo, I loose the ability to control volume at the PC, the output becomes a line out, rather than a pre-amp out.

But you really have to admit, most people would not be playing audio over both the optical AND the RCA. As for this being "inexcusable"? Just a wee bit of a hyperbole isn't it?