Almost embarrassed to ask, but...

The Marantz is a processor, not receiver, but the room is dual purpose home theater, so Oppo to amp isn’t an option. Amp is Odyssey Stratos, speakers are Aerial 7T, and I’m confident the sound for 2-Channel can be improved with a ‘real’ pre amp, not the avp. The Oppo has no streaming built in, though, hence the question. Although.....could I use the preamp that does have Spotify built in as a source to the Oppo, as well as the Oppo being the source to the processor for movies? I’m thinking that would create some kind of loop though?

In almost all cases, coaxial is better than optical.
Just get a pro audio 75ohm mogami cable (or any pro audio brand) and you are good. check sweetwater.com

preamp is a touchy subject. At the top level systems, in most cases top preamp will best a volume-control DAC (even top level there are exemption like emm labs new offerings). But low to mid-tier, if the processor/dac make good emphasis on the volume control (keywords like discrete components, class-A high bias output stages...). Oppo UDP205 probably use digital vol control with op amp. It's not going to win award.

Maybe a Hegel P20 or Benchmark LA4. The Hegel has dedicated Home Theater bypass inputs.
The Oppo 205 has usb inputs as well. I have a Oppo 203, so can’t add much additional to the conversation. 

I would definitely consider the Oppo UDP205 audiophile grade piece of equipment, and is quite versatile as well.  it’s possible to stream music from your computer via the USB DAC, use it as Roon endpoint, or stream via your network using the Oppo Media Contol app.  It’s quite acceptable to use it as a preamp, however in my particular case I did not use it that way (connected it to an integrated amplifier via the XLR balances outputs.
Gorm

Oppo and Marantz are both directly addressable as streamers. Both use UPNP and HEOS. I use both and often compare them. I find my Marantz 8805SE performs better than the Oppo205SE.
I've also wired the Oppo’s analog XLR stereo out to other amps Including the Marantz as analog stereo inputs, and using RCA to my PassLabs XA25.
All whilst happily streaming Tidal via the mConnect Lite app.
And I’ve used the Pioneer N70ae Streamer and a PS Audio PerfectWave DAC with Network Bridge Streaner DAC in this HT system. And earlier, a Cocktail Audio X40 Streamer.
All in, direct to Marantz via HEOS or mConnect Lite is best for using my HT System as a music player.
I have a separate stereo system with streaming, SACD and other sources.