I never said the PS3 wouldn't meet BD 1.1 specs. Just because something is 1.3 doesn't mean it can bitstream advanced audio codecs. Bitstream of TrueHD and DTS Master audio is an optional component of the HDMi spec, which "paidgeek" emphatically says the PS3 does not have. HDMI is not firmware upgradable. It is hardware based. Just because bitstream is in the software menu of the PS3 doesn't mean it will be able to bitstream HD codecs. It can bitstream legacy codecs.
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Agreed, but the ability should be there if it does indeed do bitstream at 5.1 why not 7.1? It will be moot once DTSMasterHD is decoded by the PS3. It has the power to do this -- Sony just needs to get going here. That is why I am hoping for the DTSMasterHD decoding when the 1.1 update is released.