Many years ago while working in audio/video electronics sales, I overheard a co-worker tell a customer that the first movie in surround sound was
Top Gun.
Doh! No, people,
Top Gun--and the bathroom fight scene in
True Lies--may have been demoed to death in stores, but it is NOT the first movie in surround sound.

Experimentation with surround sound in movies goes as far back as Walt Disney's
Fantasia in 1941. The first commercially released movie utilizing the matrix surround technology as we know it today is
Star Wars in 1977 using
Dolby Stereo.
Dolby Surround Pro Logic, or simply
Dolby Pro Logic, is the consumer version of Dolby Stereo, a matrix surround technology with logic steering for directional enhancement. In this process, encoded two-channel audio is decoded to four channels: left, center, right, and mono surround.

The directional enhancement in Dolby Pro Logic is necessary to focus sounds coming from a particular channel. Without it, certain sounds would leak into other channels where they do not belong. A good example of needing logic steering is for dialogue coming from the center channel.
The theatrical release of
Batman Returns in 1992 officially introduced
Dolby Digital (formerly
AC-3), a technology that employs digital audio compression, like MP3, and reproduces discrete multi-channel audio. Basically, in this format all channels are reproduced separately and there is no audible "bleeding" from one channel to another, which has always been a potential shortcoming of matrix surround sound.

The naming convention to describe a discrete multi-channel audio system is "x.y", where "x" represents the number of main channels--i.e., front left, front center, front right, etc.--and "y" indicates the number of Low Frequency Effects, or
LFE, channels which carry audio from 20 Hz to 120 Hz. As we know, the ubiquitous discrete surround sound configuration is 5.1.
Despite the minor technical drawbacks of matrix surround sound, Dolby Pro Logic has served us well for decades, and the introduction of
Dolby Pro Logic II--designed by surround sound guru,
Jim Fosgate--pushes the matrix surround performance to near discrete surround quality. In addition, Pro Logic II decodes more channels, adding separate left and right surrounds, and works with encoded
and non-encoded stereo material.

Digital Theater Systems, best known as
DTS, introduced their competing discrete surround sound system with the movie
Juarassic Park in 1993 and, like Dolby Digital, is widely available in consumer A/V equipment.
So question is: With so many surround modes to choose from in a typical A/V receiver or preamp/processor, how does one know which mode to use?
Here are the general guidelines I tell clients with systems capable of reproducing 5.1 surround sound:
- If you are watching a program that has Dolby Digital or DTS audio, like an HD channel on satellite or cable TV, the receiver or preamp/processor should automatically detect the bitstream for decoding, and you should not have to do anything. Be sure the decoder is set for automatic surround mode selection if so equipped.
For material encoded in Dolby Surround, select Dolby Pro Logic II Movie, also known as Dolby Pro Logic II Cinema. You should see the "Dolby Surround" logo indicated somewhere on the video case packaging, or in the case of broadcast TV, usually indicated at the beginning of the program, like "Presented in Dolby Surround".
That's it.
When listening to music, if you find that the front channel sounds tend to "collapse" to the center channel, try using
Dolby Pro Logic II Music, but the Cinema version should suffice for most program material.
Dolby Pro Logic IIx enhances the original Dolby Pro-Logic II by decoding a back center (or rear center) surround channel.
You can certainly try other colorfully named surround modes like "Unplugged," "Jazz Club," "Disco," but these typically add artificial reverberation and reflections that are not in the original recording and, therefore, some folks may find them tiring to listen to after awhile.
DTS Neo:6 is a competing format of Dolby Pro Logic IIx, and should not be confused with discrete 5.1 DTS surround decoding.
Dolby Laboratories commissioned Jim Fosgate to design Pro Logic II, and many professionals in the industry seem to prefer the latter. I would recommend trying both and see which one
you prefer.

On a side note, compared to the other next generation gaming consoles,
Nintendo Wii is the only one that solely uses 2-channel analog audio for sound. Because it uses Pro Logic II for encoding, I would select Dolby Pro Logic II Movie, but you must set up the audio option in the Wii for "Surround" instead of "Stereo".
If you ever see
Dolby Pro Logic Emulation mode, skip it. This is essentially the original Dolby Pro Logic decoding which decodes to only four channels, instead of five for Pro Logic II.
Another topic that often comes up with customers that really needs to be discussed . . .
Don't expect to hear surround sound all of the time.
What you hear from the surround speakers is entirely at the discretion of the filmmakers and content producers. The primary purpose of these channels is to envelop the audience with ambient sounds to create the sensation that you are in the scene (e.g., rain, wind, jungle sounds) and they can range in volume from very subtle to loud. Occasionally, you may hear directional effects, like flybys, or vehicles passing by.
If you're watching an action flick, you are practically guaranteed to hear a lot of surround sound. On the other hand, a drama may hardly have any activity in the surrounds. This is because directors and sound designers
want it that way.
For non-encoded material, results may vary even more widely. For example, during the news you may just hear speech coming from the center speaker, but when you hear the lead-in music, you will probably hear sounds spread out throughout the room.

Incidentally,
The Terminator was such a low budget movie, director
James Cameron didn't even do a stereo mix for the movie soundtrack. Yes, the original movie soundtrack is in mono! That's right, if you watch
The Terminator with the original soundtrack, and sounds will only come from the center speaker. (A few years ago, the movie was re-released on DVD featuring a new soundtrack remixed into 5.1 by award-winning sound designer,
Gary Rydstrom.)
In short, don't try to "listen" for sounds from the surround channels. As long as your home theater system is properly calibrated, doing so will only detract you from enjoying and experiencing the movie, TV show, or whatever the case may be.
One Final Note: For some unknown reason, certain movies on DVD default to Dolby Surround or 2.0 soundtracks upon initial playback. Some Disney/Pixar movies, like
Cars, are notorious for this.
The first thing you should always do after loading a DVD or Blu-ray video is go to the disc menu, and select the audio soundtrack for the best audio reproduction for your system, i.e., 5.1 Dolby Digital, etc.
Surround sound has come a long way in the past few decades. The information presented here serves as the foundation about surround sound, and even as the technology continues to evolve, having some basic knowledge and understanding of how to use the various surround modes will let you appreciate your home theater more. Just remember that
Top Gun was not the first movie in surround sound. ;-)