I recently had my LG C2 OLED automatically updated and struggled with non-PCM output as well.

Just set it to output LPCM to Optical Out in the TV, AppleTV can still be set to multichannel.

DSP8000SE, DSP7200SEHC, DSP5200SE sides, DSP7200SE rears, 861v8, 210, Sim2 Ultranero 4, Stewart Cinecurve 2.35:1, XEIT CM-5E Anamorphic lens, Dune HD Duo Cinema 8K and Wireworld Platinum 48G HDMI -> UHD722 -> Shunyata Omega Ethernet. Shunyata/Furutech power-cables/filters. SR Master Fuse@861v8. Uptone Etherregen with 10MHz OCXO clock.