I have a QE55QN700A 8K TV; I have a soundbar connected to the e-arc port, HDMI 3. However when the e-arc setting is set to "auto" rather than "off", all of the apps, such as Netflix, Prime, Disney Plus and Paramount Plus only output PCM audio to the soundbar; no Dolby Digital, Digital Plus or TrueHD; it does weirdly still output Atmos. (The soundbar itself supports e-arc and has no issue with those formats from a Blu-Ray player, which is why I suspect the TV).
However when I turn e-arc off, all the apps start to output Dolby Digital and Digital Plus, and Atmos again, (which is weird because I thought e-arc was the requirement for the newer audio formats, I'd have thought turning e-arc off would mean no Digital Plus or Atmos but it seems to be the only way to get them).
Moreover, I have a Blu-Ray player which needs e-arc on, in order to passthrough Dolby TrueHD, so turning e-arc off isn't a permenant solution; as turning e-arc off prevents passthrough.
TLDR: e-arc being on shouldn't limit audio output to PCM only; e-arc on is supposed to provide better support for audio, not worse.