SDDS can be 5.1 or 7.1. In it's 7.1 version it is configured differently than most home 7.1 systems, using 5 channels up front and 2 surrounds. The 2 additional front channels go between the usual 3, giving you left-of-centre and right-of-centre speakers.

SDDS-8 is intended mostly for really big theatres with very wide screens, where 3 speakers across the front might be insufficient. Probably overkill for home use (I can think of better uses for 2 additional channels), and Sony has never hinted at bringing it to consumer gear.

Best,
Sanjay