Questions on optical connections

I just received my 990 and I am in the middle of hooking everything up and I have a few questions.
As I understand it using the optical hook-up from my Sony cd changer bypasses the DAC and sends a digital signal to the 990 and the 990's DAC does the processing.
Can/ should I also use the optical out to hook up my Motorola cable box and Oppo DVD player to the 990?
Will they pass the 5.1 surround through the optical?

Using the optical digital connection will bypass the source's DAC, at which point the 990's DAC will handle the D/A conversion. In general, you'll want to use digital output from any sources that you can (especially DVD players). The sources will pass a digital bitstream that will contain the multichannel audio (Dolby Digital or DTS), which the 990 can then decode for you.

Gonk, When using the optical out on the Oppo DVD can I still get DVD Audio?

No, for DVD-Audio discs you will need to connect the multichannel analog output. For all other discs (DVD-Video and CD), you'll be best off using the optical or coaxial digital output (it doesn't particularly matter which).

SO, is there a benefit to even hooking up the optical on the Oppo or should I just run everything through the analog ouput?

There is a significant benefit to hooking up the optical. The 990's DSP section and DAC's are better than the OPPO's - using the optical connection for DVD-Video will give you access to Pro Logic IIx decoding (good for getting surround sound from Dolby 2.0 sources and getting 7.1 from Dolby 2.0 or 5.1 sources if you have surround back speakers) as well as Dolby EX and DTS ES decoding, and it will bypass the OPPO's rather lackluster DAC's.