Hi,
I do not see any evident that PureLink supports multi-channel HDMI audio decoding, physically, with single coaxial and single optical output, there is no way to send 8 decoded (from HDMI multi-channel audio) channel with a digital audio link.
To clarify things, HDMI 1.1 supports multichannel, and 1.2 in additional supports SACD multichannel. Difference however, is that there is no mentioning that with multichannel SACD, the downstream component could decode high-bandwidth digital audio at 96khz/24bit because the supported data rate doesn't add up. Therefore, the true multichannel (true) HD audio up to 8 x 96kHz/24bit, is only supported with HDMI 1.3.
DSD to PCM transcoding, in my opinion, is perfectly fine, because at the end of the day, there is rarely any pure DSD recordings. Most of the SACD we have today are recorded, processed, and produced in PCM, then transcoded to DSD purely to cater to 'audiophiles'.