I have few queries on the setup
1. If I connect the STB HDMI to TV directly and optical connection from TV to AVR, will I get original 5.1 or surround 5.1? Assume that the content in the TV has 5.1 audio
You should. But it is better to connect the HDMI or optical out of the STB to the AVR directly.
2. How do I know that whatever I am getting is 5.1? I was playing Avatar movie from the recorded Tatasky STB, the receiver shows as "D" in the display. When I check the speakers, I am getting sound from all the speakers..
If it shows Dolby Digital symbol, then the audio is Dolby 5.1. There should be options to display audio information in your AVR (My denon avr has).
3. Shall I assume blindly that the Audio is 5.1 if at all I am getting sound from all the speakers??
No. Stereo sounds will be converted to virtual 5.1 using dolby prologic, dts neto:6 etc.
4. What is Neo:6 sometimes receiver displays this.
Explained in 3.