Bravia, BDV-E370, Sky+ HD and Xbox 360...how to connect?

[BlueChippy16]

Can anyone offer me any advice on how to set up my equipment to get the best out of it all - and most importantly - minimise the number of settings to change?

I know the REAL problem is that SKY HD doesn't output 5.1 through HDMI, however the XBox does.

The TV has optical out, the Sky box has optical and co-ax out...however switching to use co-ax means having to change the BDV input setting every time.

My current setup is:

Bravia [hdmi 1] <-> [hdmi] BDV (using ARC)

Sky [hdmi] -> [hdmi 2] Bravia

XBox [hdmi] -> [hdmi 3] Bravia

Sky [co-ax] -> [co-ax] BDV

This gives me 2.1 from Sky and 5.1 from XBox without having to change any settings.  I can switch to co-ax input on the BDV to get 5.1 - but I think ARC seems to be interfering with this?

Questions:

If I plug optical from Sky to BDV, will this override ARC so that the Xbox still gives 5.1 sound?

If I turn off ARC, then will the XBox 5.1 stop working without a separate connection?

Whats the best/EASIEST way to connect everything up so I get the best sounds, with the least amount of remote key presses?

Equipment:

Bravia KDL40HX703

BDV-E370

XBox 360

Sky+HD

Many thanks