Ronan, please bear in mind that my understanding is rather limited but I will endeavour to explain it as best as I can.
As far as I know the 3 sound formats available are, LPCM, TrueHD and super dts (or something like that).
LPCM is uncompressed and therefore lossless so theoretically should sound better than the other 2. However TrueHD though compressed is a very good codec so aurally sounds the same as LPCM. I don't think super dts is yet available but may be wrong.
The only way to get the new sound formats to an amp is either via HDMI or 5/7.1 analogue connections. Optical and coaxial digital don't have the necessary bandwidth to handle it.
Your amp does not need to be HDMI 1.3 to accept LPCM. My Onkyo 604 (HDMI 1.1)will accept LPCM over HDMI as long as the player (PS3) does the audio decoding on board.
However if the player is not capable of doing the audio decoding then you would need an amp capable of doing it instead.
The Yammy 757 is an excellent amp but unfortunately has no HDMI connections so the only way to get the next gen sound formats is through analogue connections. There aren't that many players about that will output via analogue. I think the Tosh XA1 will but it's cheaper brothers will not. The PS3 will only output HD sound formats via HDMI period and there are currently no plans to include an analogue output option.
My advice would be to keep the yammy for a year or so then upgrade. LPCM is good but not good enough to warrant shelling out 400 quid for a capable amp. Bitstream over optical is still very good indeed.
The tech is still rather young and in a year or so the dust should have settled so upgrading will be clearer and probably a lot cheaper.
mephistophelean, all the BR discs I have are either DD, DTS or LPCM. I'd say around 70%- 80% of them have LPCM soundtracks so yes, BR discs do have the next gen sound formats and arguably the best version at that.

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