Too bad. This is a big flaw.
Probably inside of the device the hardware is made in such a way that the digital signal from HDMI and optical signals go through the same channel and it is difficult to detect at the processor level where does it come from... :/
However, in this case, if it is unrepairable, then in the WiiM Home application it should not be possible to activate auto sensing of both HDMI ARC and Optical In. There should be one of them to choose from. Otherwise, it is misleading.