Sound quality: Tata Sky vs Netflix/PrimeVideo?

Still one cannot compare the Blu-ray discs with firestick on audio quality. BD's will win hands down when compared to firestick. Hope you would have checked if Stereo/All channels mode is not enabled in the Yamaha receiver.

Which mode is recommended in YHT receiver when using firestick, so that I can feel the 5.1 effect of channel separation?
 
Haven’t used Yamaha HT per se, but there should definitely be audio options like Music, Movies et all, and under each various sub-segments like stereo, Dolby surround etc.. Depending on what you’re playing & which sound signature please you more, you should go for that. Trust your ears!
 
Ultra > BD > Streaming > DTH
In my experience, atleast for regional movies, DolbyDigital on Airtel DTH was better than the same movies on Fire TV as most of them were only 2.0 (atleast on ZEE5). Sun Nxt shows DD symbol along with thumbnail for title that has multi-channel sound. Don't remember being really impressed with Hotstar/PrimeVideo regional content either...
 
Which mode is recommended in YHT receiver when using firestick, so that I can feel the 5.1 effect of channel separation?
Usually my Onkyo receiver decodes the audio signal automatically and plays 5.1 if it is transmitted on the same. YHT receiver will do the same. Get some professional help to check the connections. Changing the mode will not work out to get the 5.1 effect.
 
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