You’re running into limitations of the LG TV, the Plex SmartTV app, and Plex Media Server.
Short Answer: Use an Nvidia Shield Pro connected to an HDMI input on the Denon receiver. You can also use an Amazon FireStick 4K gen 2. However, for DTS audio formats, it passes only the lossy DTS core (so no DTS-HD MA or DTS:X).
Details
LG Audio Codec Support
No TV supports TrueHD audio (LG, Samsung, etc). When using the Plex SmartTV app, it is transcoded to a supported format. This also applies to TVs using the Plex AndroidTV app (Sony, etc.).
Some TVs do not support DTS audio formats. If DTS is not supported, when using the Plex SmartTV app, it will be transcoded to a supported format.
LG removed support several years ago, but recently added it back starting with the 2023 models. You can check the tech specs for your model (or the review at rtings.com) to see if DTS is supported.
HDMI-eARC audio passthrough
Note: Both the TV and the attached receiver/soundbar/etc must support HDMI-eARC.
No TV supports TrueHD passthrough from a TV based app.
LG TVs support TrueHD passthrough for devices attached to an HDMI input on the TV.
If the LG TV supports DTS audio, it will passthrough DTS over HDMi-eARC from both TV based apps and devices attached to the TV’s HDMI input.
If the LG TV does not support DTS audio, it will not passthrough DTS from either TV based apps or HDMI attached devices. DTS will be transcoded to a supported format.
Plex LG SmartTV app, subtitles, and Plex Media Server
When using the Plex LG app, if the media is direct streaming, such as when audio is transcoding, enabling any type of subtitle results in a video transcode.
In addition to the video transcode, Plex Media Server burns the subtitles into the video stream. Subtitle burning uses the CPU, even when using hardware accelerated transcoding.
If the CPU cannot burn subtitles in real time (common with 4K media), the end user experiences buffering.
Note: “Subtitle burning” is the process of adding the subtitle to the video frame instead of sending it as a separate track. PMS decodes the video, then adds the subtitle to the video frame, then encodes the video to the desired format. The process occurs frame by frame.
Plex Android TV App, Nvidia Shield Pro, Amazon Fire Stick
The Plex Android TV app is not as limited as the SmartTV apps.
The Plex Android mobile and Android TV apps direct stream subtitles even if the video or audio is transcoding. Subtitle burning does not happen (I’ve not tested with SSA/ASS subs, but they should be supported).
The Nvidia Shield Pro will passthrough TrueHD + Atmos and DTS/DTS-HD MA/DTS:X audio formats if supported by the attached audio equipment. It is the only off the shelf streaming box that does so.
The Nvidia Shield Pro supports Dolby Vision and HDR10 video. HDR10+ is not supported. When playing HDR10+ video, Plex plays it as HDR10 (HDR10+ is backward compatible).
The Amazon FireStick 4K Gen 2 and Cube v3 will passthrough TrueHD + Atmos audio. With DTS audio formats, only the lossy DTS core is passed.
The Amazon FireStick 4k Gen 2 supports Dolby Vision, HDR10 and HDR10+ (specs).