The output is recoded to MP2. But if the source is AC3 you should still be able to preview the adjustment in the UI and that's not working, which leads me to believe there is a bigger issue with the volume adjustment in general.
True, but most of our users know that AC3 is passthrough only so if they recode they will lose AC3. On the plus side we do support up to 8ch AAC output now, so there is at least an option for retaining multi-channel audio.
FYI I've fixed this issue. It will be in the next release.