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My understanding is that the 120 Hz low pass is also applied to the LFE channel from DD/DTS/etc sources as well. Entirely different from the low pass to the sub for the center, mains, and rears/surrounds.
Correct, this takes place in the decoding stages along with the 10db LFE boost.Some soundtrack however already "filtered" before encoding,and DTS at half bitrate start to roll off at 90hz.