HD HomeRun Extend and Transcoding for AppleTV 4k

I have an HD HomeRun Extend set to “Highest Quality” - so it’s transcoding to H.264 transport stream in the hardware before sending it to Plex. I’m running Plex server on an Intel NUC with an i3-7100U processor, i

If I record a show and play it back through the Plex client on the AppleTV, i get direct play. I verified that the shows are recorded as an H.264 transport stream on disk.

However, if I watch a show live on AppleTV, Plex transcodes it on the fly from “H.264 (hw) to H.264 (hw)”. Why is it able to “direct play” when watching a recorded show, but transcode when viewing it live?

Did you ever figure this out? I just bought an AppleTV 4k today and I can’t get my HDHomerun Extend to DirectPlay any live TV either.