I've never heard of five or seven channel STEREO. It is always multichannel. For example, mch files from Channel Classics have Left and Right Channels (similar to stereo) but also a center channel and two rear (Left and Right) channels for ambience. Usually that is 5.0. Sometimes it is 5.1, where there is a separate subwoofer channel. The recording engineer captures the recorded sound in 5 or 5.1 channels or they are mixed from more channels down to 5.0 or 5.1. I am guessing that is what you are referring to.
My mch preamp - Conrad Johnson MET-1, is just that, no DSP. It just plays the 5.0 channels or 5.1. Also my NADAC mch plays the 5.0 or 4.0 or 5.1 channels (it will go up to 7.1 but I only have 5.1 in the CJ, no DSP. So when I play my mch music files, there is no additional processing.
There is a second set of mch inputs in my CJ MET-1 to which I connect my Oppo 105, and that can play bluray movies, etc. and the Oppo has different settings and can decode Dolby and other processed sound in movies, but that is completely separate from my audio only mch music files. I rip all my SACD's to digital files, DSD64, and they get played through the NADAC mch (using Roon and HQP).
Larry