It should all just work.
I have an Onkyo with 5.1 speakers.
If passthrough is disabled and I set Kodi to 7.1 then:
5.1 audio will be output as 5.1. Onyo will play to the 6 speakers.
7.1 audio will be output as 7.1. Onyo will downmix to the 6 speakers.
If passthrough is disabled and I set Kodi to 5.1 then:
5.1 audio will be output as 5.1. Onyo will play to the 6 speakers.
7.1 audio will be downmixed by kodi to 5.1. Onyo will output to the 6 speakers.
If passthrough is enabled and audio is DTS or AC3 (DDP) then audio will be passed through to onkyo and it will handle all decode/mixing necessary.