There used to be some limitations with Dolby Vision as well, but I think those have mostly been straightened out now.
I have a modest AVR and 7 channel setup and still watch movies on my shield which is still getting android updates
Similarly, It CAN do Atmos for E-AC3 audio, but E-AC3 is meant for streaming, so it's really rare to have that in a file you're playing back locally.
Basically, it just falls back to whatever the next best thing it can support is at the hardware level.
This is one area where Android wins. The Nvidia Shield, despite being ancient, is your best bet for local playback. It's still limited on the supported Dolby Vision profiles, but can just pass the audio through to your receiver without mucking with it. So you get all the bells and whistles.
Other than the shield your only alternatives are weird dedicated devices that are literally built for playing back UHD blu-ray rips (Dune HD, etc).
https://community.firecore.com/t/help-get-more-dolby-atmos-o...
Only Dolby Atmos from WEB-DLs will play, and you need to use a supported player (like Infuse or VidHub).
It’s a tvOS limitation.