If playing back 2 channel content from apps on my game console, the audio quality is bad from my soundbar: Dialogues are recessed and the sound gets muddy. What can I do to improve?

Gaming consoles like the PS4 or the XBox One S / XBox One X can be set to output sound in 2 channel PCM or bitstream audio as Dolby Digital or DTS. If you set your console to Dolby Digital or DTS, the game console outputs all audio regardless of the original format as 5.1 signals in Dolby Digital and DTS.

If you are playing 2 channel sounds from, e.g. YouTube app of the game consoles, soundbars like the Magnifi Max SR decode the whole signal and assign the channels as they are present in the original stream. Since there is only sound from Front left and Front right, the center speakers as well as the surround speakers will not play any sound resulting in a muddy sound.

If you configure the game console to output 2 channel PCM, 2 channels signals will be just output as such. The Magnifi Max SR then uses an up-mixer to generate the missing channels such as Center and Surround resulting in a much clearer center image and surround sound effects.

Therfore, it is strongly recommended to configure your gaming console according to number of channels in the source material