The Plex app uses the native video player built into the webOS operating system. Therefore, it is limited to the codecs supported by the TV set hardware and webOS operating system. These are generally the codecs listed in the TV specifications (some of which may be restricted to streaming audio only and cannot be used as part of a movie stream).
Other apps, including those supplied by LG, such as the DLNA client, may have the ability to decode additional audio formats in software.
The Plex app does not have software decode capability. Therefore, audio formats such as dts will be transcoded by the Plex Media Server to a compatible format.
Furthermore, there is a difference between local playback (ex: from USB port) and streaming (Plex, DLNA, etc). The streaming protocols used between the Plex server and the Plex app (HLS, etc) may also restrict which audio formats can be supported.
The above is my understanding of things (I’m not a developer, a Plex employee, or privy to how Plex develops their SmartTV apps).
This topic comes up occasionally. You can search the forum to find them. Here is a recent thread on the topic: Lg web os audio codecs .