Most lossy formats like AC3/DD or DTS don't have a "real" bitdepth, the decoding results in 32-bit floating point data, and that is exactly what LAV outputs to MC - untouched from the decoder. Most audio output devices don't support floating point however, so it needs to be converted somewhere. If you disable these modes in LAV, it will do the conversion, otherwise MC will do it - no matter what you do, it has to be converted somewhere. You should try to keep the audio in the highest bitdepth possible for as long as you can, so do the conversion as late as possible (so not in LAV Audio).
As a general rule:
- "Lossy" formats don't have a "bitdepth", they should always result in 32-bit floating point, if possible. This includes format like: AC3/DD, AAC, DTS, MP3, Vorbis, and many more.
- "Lossless" formats have a real bitdepth. They should be decoded to that exact bitdepth, and nothing different. This is usually 16-bit or 24-bit integer. This includes: TrueHD, DTS-HD MA, FLAC, ALAC, .... and more
Not all decoders function to these exact specifications, but in LAV Audio i try to stick as close as possible to it as i can.