Decoding Dolby digital on a PC?

I was not thinking about recording at this time. Just real time decoding that offers 2 channel analog output on my sound card. 5.1 channels will need to be 2 channel mixed down obviously.

Recording, I must say, would be a lovely option and I assume there exists software to do this.

Related question: At what level or area is Dolby decoding accomplished? I've assumed the Motorola DVR, for example, does it at the hardware level. But that hardware may be firmware controlled, essentially the same as software. Comments?

I've begun a project whose goal is to make the highest quality Audio PC I can afford. The initial goals are superior CD playback and Dolby decoding. Recording is obviously desirable. My current machine is a test bed.
MSI, 2800 Sempron, 1 gig ram. Wimpy, but struggles through.
SC provides spdif input.

Video is not a current goal, but from what I understand it may be easier to just make a full-blown HTPC.

I'm a little confused by your question. What exactly do you
need the PC for? Are you planning to record to the PC and
playback from it? Thanks

There's a crap load of free software out there that will
decode Dolby and DTS on the PC. You can download K-lite
codec pack from www.filehippo.com.

As long as you have a Sound card to output it, you should be
fine. Most sound cards do these days.