"Unity gain" refers to a type of home theater bypass that some two channel preamps have. It is different from the type of bypass that works even if the two channel preamp is powered off. The Cary SLP03 for example has this feature. There is some controversy over which type is superior. Cary claims that a unity gain bypass helps avoid hitting your amp (and speakers) with too much signal if you inadvertently left your prepro "on" with the volume high when turning off the two channel amp in bypass mode.

Connecting the two channel preamp's output to the inputs of the prepro defeats the purpose of using a separate (high quality) two channel preamp. The high quality two channel preamp must be connected directly to the power amp to realize it's superior analogue abilities. A two channel preamp with home theater bypass, whether unity gain type or not, can do this since the output of the prepro is connected to the bypass input of the two channel preamp, and the two channel preamp's output is connected to the power amp's input.