I believe that the Trinnov episode with Sherwood hurt Outlaw more than anything.

As for HDMI, there are tons of devices that use it in the market, not only A/V gear like receivers, DVD/BD players but also a multitude of small boxes like the Rokus, Apple TV, etc. To implement HDMI, an EE designer chooses a System-on-chip (SoC) like those from Analod Devices or others that integrate all the HDMI functionality (transmitters, receivers and switches). The complexity really comes after HDMI. When you have to integrate a pair of general purpose DSPs with a memory subsystem running some form of room correction into a bus along with all the other circuits (HDMI, S/PDIF, DACs, etc.) and then control everything with some proprietary software or an imbedded OS. All of this requires a lot of digital circuit design and low-level programming expertise from a team of engineers; the R&D involved is complex and expensive.

In the days of DVD with Dolby digital and DTS with no room correction, A/V processors and receivers used mostly off-the-shelve ICs and fixed-functionality DSPs that provided most of the features. There was much less routing and custom processing of the data involved.