"When asked why PowerDVD downsamples HD audio from both Blu-ray and HD DVD discs to 48KHz / 16-bit, Chen responded by saying that "digital output without protection is not possible due to AACS requirement. Digital and analogue output with protection (HDMI) is also not possible due to lack of an internal secure audio path in a Windows PC.
"We are currently working with Realtek to support their proprietary interface for encryption of audio bus. Once completed, we will not longer need to downsample the audio. This will be provided for free to end-user for upgrade."
This didn't really clear up the downsampling situation though because, as far as we're aware all audio, regardless of encryption, is downsampled. We therefore pressed Chen to clear up the speculation."