Multichannel PCM is a form of CD audio, only with more channels and more data. HDMI supports up to 32 channels. But I have yet to see anything consumer that goes beyond 8 channels.

Transit means that the sound is transmitted in the original.
It can be anything. DTS, DTS HD, TIG Dolby, DSD, 360, MQA, PCM variants.
You may have forgotten a little. So the media is sent over the cable as is. It is the receiver’s job to convert it into something audible.

PCM is so standardized that almost anything can be decoded into audio.
I would let my amplifier decode the audio. It was built for that. The TV is an afterthought. After all, TVs are designed for broadcast and TV applications. Audio is secondary there anyway. The audio object (atmos, dtsX) has more than 8 channels and does not fit in a PCM system. And certainly not from a TV! So the atmospheric information has to be passed through unimpeded and translated into something that can do that.

Many of the ARC and EARC functions are also very limited! Audio played through the ARC often cannot be played in non-standard formats. For example, my TV does not support a sample rate of 88.2 kHz. 96 or 192. Unfortunately, there is no pass-through or PCM translation for these formats.

In addition to Atmos and DTSX, there is another important format that cannot be translated 1 to 1 to PCM. DSD. It is a 1-bit format with over a million samples per second.