Apple TV 4K won’t output surround while audio format is set to auto

Plex Players Streaming Devices
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Server Version#: 1.20.1.3252
Player Version#: 7.6

While the audio format in the Apple TV settings is set to auto ie change format is off, multi-channel audio is downgraded to stereo in Plex. Other apps like Netflix, TV, Amazon play multi-channel audio fine.

When the audio format is changed to Dolby digital 5.1 in the Apple TV settings, Plex plays surround sound with no problems. My receiver display changes to DD 5.1.

I should note that Plex direct plays in any situation.

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