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You can't just plug in optical cables. Both the TV and amp have to be adjusted to allow the different type of signals to pass. I have an Onkyo receiver myself and you have to set the sound type up for each input. It's a bit tricky to do without a manual, but you can probably download one for free if you have lost yours.
Since you are running the to LCD monitor instead of a LCD TV this is where you run into the issue. because the monitor is not setup to pull out the audio from the HDMI connection. So there is a few ways that you maybe able to to this.
The first one is look around at the different output cables out there the PS3. (I just got one so I do not know the accessories that are out for the PS3) This is becoming a common setup so if Sony does not have cable that will split off the audio then a 3rd party group may. I know they have one like that for the XBOX 360.
Another you can try is if your monitor will except an analog connection you may need to go that way. That is how I have my XBOX 360 that is my room connected. I have a RBG HD to VGA connect the VGA input on the monitor and the audio going to my sound card.
The reason why I suggested going analog is that right with our curent technology that if you are run with the 2 formats at the same time you will get audio/video sync issues. So you need to go all analog or all digital.
I hope this helps. Let me know if you have any other questions on this and/or need me to clarify anything.
This reciever does not decode the audio through HDMI, the HDMI ports are simply a pass-through. To get audio you need to connect an optical audio cable from the PS3 to the reciever also. I figured this out after 2 hours of trying to get audio from the HDMI cable. Here is a link that shows the different audio formats supported through HDMI by the different Denon models. It looks like the AVR-788 is the lowest model that supports audio through HDMI. Hope that helps.
You must run a Digital Optical cable from your PS3 to your reciever. Then press your function button on your recievers remote until you see SAT/CABLE on your recievers display. Next go to your PS3 settings and go to Sound settings, then Audio Output settings, and select Digital out (OPTICAL) then your done. This is the only way to get true digital sound from your PS3 to your reciever.