Use HDMI, so much better, also easier to setup. HDMI has full bandwidth, toslink does not.
In my HT setup, my TV is the hub, everything plugs into it, using eArc from the TV to the receiver. TV is set for passthrough for sources and PCM for the TV. Using BlueJeans HDMI 2.1 cables, receiver is plugged directly into my WiFi router, as is the TV.
Movies sounds wonderful, get my full surround sound. I can stream directly to my receiver using Tidal Connect, it displays song with artwork on the TV. Can also Airplay to the tv, but not as good as direct.
With eArc, my receiver will automatically turn on/off change sources, keeps the settings for each source.