Why not just include the Dolby stream rather than worry about transcoding from one lossy format to another? BluRay and HD-DVD manage to include h.264 video and actual Dolby (or DTS) streams together. Or is there an issue with the container Apple uses?
Because AC-3 can't be encapsulated in H.264 as far as I know. This could change at some point but it's not the case at present. In fact, I don't know of any multimedia video codecs in which AC-3 can be encapsulated. It isn't encapsulated on DVD's... The MPEG-2 and AC-3 streams are separate and synchronized.
Well...it certainly sounds better to my ears. And DTS-HD Core sounds better again.
That may be, but I would contend that in a blind test where you don't know which format you're listening to, you wouldn't pick DTS as the winner.
No harm no foul unless you made purchases predicated on the videophile misconception that DTS is better, which is furthered by asinine snob magazines with articles written by people who don't understand the fundamentals of perceptual coding.
When I really dig in and dissect what people like about DTS, they can only actually quantify one thing... it's louder.
Well, if you like louder, there's an easy answer... turn up the volume about 4dB, because that's the baseline difference in attenuation between Dolby Digital and DTS. The difference being that DTS doesn't have dynamic range control, dialogue normalization or low-pass filtering at 20kHz to eliminate aliased frequencies.
That last one is so critical it's the very first critical component of any digital audio encoding system that Ken Pohlmann stresses in
Principles of Digital Audio, widely regarded as THE digital recording/engineering bible.
And I find it horrendously amusing that not one AV snob seems to understand it... They in fact believe in the exact opposite, sampling frequencies above the Nyquist limit which is patently absurd.