VDM Surround Edition can easily handle any surround (5.1) ACM codec avaliable as well as stereo ACM codecs. You can also convert sound formats between stereo and 5.1 both ways with VDM Surround. It is new to any VirtualDubMod release since all previous versions had bugs disabling it from proper 5.1 sound handling and conversion.
Now when converting surround sound movies you can reencode 5.1 tracks to different bitrates to save space. Lets say you have a movie accompanied by 448 kbps AC3 track, now you can save space taken by sound by either: converting this to 128 kbps Aud-X mp3 5.1 format or reencode to 192 kbps AC3. Now such things are possible!
Please note you have to check settings on updated "Conversion" tab before choosing sound encoder. List of avaliable encoders and options vary on settings made there!