handbrake encoding dts vs dolby

I am having some issues playing audio on my Nakamichi Shockwafe 9.2 system. When playing blu-rays off the disc, I have noticed that everything plays fine throughout all the speakers (cyberlink with uncompressed audio) and the soundbar will read Dolby D or DTS depending on the movie.

However, I have noticed that when I watch most movies which I have encoded with handbrake, the soundbar will display PCM multi channel and will only play the audio on the front speakers (kodi with audio passthrough). I have found this issue only happens when it is trying to play a DTS encoded movie - other movies encoded as something like ac3 play fine.

Whenever I have encoded movies with Handbrake, I have always selected the auto passthru option under audio and let handbrake handle how it encodes it. The issue with the surround has come about when the movie audio track is DTS. For whatever reason, the final encode doesn't play through the surround speakers on my Nakamichi with the soundbar displaying M-CH PCM. However, if it was a dolby track that was encoded, everything plays fine with the surround speakers.

When I tested different audio codecs, I get some interesting results. I took the DTS track and selected auto DTS or auto passthru and still the same issue happens where I only get the front speakers playing without the surround speakers and the soundbar displaying M-CH PCM. However, when I take the DTS track and encode it in other formats (ac3 pass, auto dts hd pass, auto true hd pass, eac3 pass, flac pass, or acc pass) the final encode will play through the surround speakers but the soundbar will display Dolby D. It seems to sound pretty similar to the original DTS track when I played it through cyberlink on the blu-ray and I can't tell a difference. Am I losing some quality or info by converting the track from DTS to Dolby? Of all those formats where I get surround, is there a specific one I should be using (they are all about the same file size and I can't tell the difference in quality)?