[Tinwarble]

What settings do we have to use to make sure the HD audio streams decode to PCM? Or does Koying's "* (not working HD audio)" note mean it isn't possible yet.

No, HD audio in any form (pass-through or PCM) is not working at this time.

Distorted sound with pass-through on Vizio 5.1 soundbar.

Try changing to 'Fixed output' in 'Settings > System > Volume mode' and turning the volume all the way up in Kodi (right joystick).

Tried it, same results. Same thing happened on my RK3288 Beelink r89 device. The fix was I had to use optical out to the soundbar, the shield only has hdmi. The Netflix app doesn't play any videos with 5.1 either. Strange my PS3 hdmi bitstream works just fine.

Shield HDMI -> TCL TV -> COAX SPDIF -> VIZIO 5.1

According to posts in the Nvidia forum there may be a bug in relation to your setup. There are many people complaining about HDMI to TV, then SPDIF to whatever is not passing through 5.1 audio with Netflix.

However, several have said that pass-through is working in Kodi. But that may be a case by case basis. You'll probably have to wait for an update from Nvidia before this will be fixed.

Ok thanks. Is this build not using the DTS Ma decoder that the RPi2 is?

No.