mahty,

It is possible with either the optical audio cable or the stereo out on the plasma to transfer the audio, but the optical on the television will only pass a stereo signal (except for the tuner on the TV, which is capable of passing 5.1 - all other inputs will be downconverted to 2.0).

If you're looking for surround sound, your best bet would be to hook up the cable box's optical audio directly to the HT-BD1250 with optical. Don't forget to switch the audio output in the cable box to optical and note 5.1 out.

--HDTech