way too much hate and anger in forums, and not enough useful information.
DTS and Dolby Digital are surround formats. They started off as 5.1, and then 7.1.Both also have their own version of 'lossless' (uncompressed) audio for Blurays, Dolby Digital HD and DTS: Master Audio. Now they are into Dolby Atmos and DTS-X, which is what your headphones 'simulate'. I found this forum because I'm an audiophile and looking for a good set of headphones that support either Dolby Atmos and/or DTS-X.
Dolby Digital is a more common format, DTS has a higher bit rate (more information. Sort of like saying 16bit colour vs 32bit colour, though not as big of a difference as that).
The new Dolby Atmos and DTS-X standards are meant to be 'channel free', but for transitioning purposes for people to understand, they are commonly referred to x.y.z. x being the number of speakers around the sides of the room, common being either 5 or 7. y being the subwoofer (low frequencies are non-directional, so you can't hear a 'stereo' sound from them, but you can hear a difference if you place them front and back. High end A/V receivers have an audio set up with a mic that balances your speakers for you), and z being the amount of speakers on the ceiling now, usually 2 or 4. If you go to the theaters now, look up and you'll see speakers on the ceiling now.
When you buy or download a movie and it says Atmos (not sure if there are any DTS-X blurays out yet) it is still playable on a 5.1 or 7.1 system, it just has an added audio encoding for systems that are Atmos and DTS-X enabled. As I said, they are meant to be 'channel free' because instead of being recorded and mixed as a 5.1 or 7.1 solution, they are specifically directional. New Atmos/DTS-X A/V receivers have that set up mic I mentioned earlier that measures what speakers you have and where they are in your 3D space (you have to move the mic around a few different places and it measures the distance for each by sound). Both Dolby Atmos and DTS-X support up to 32 speakers total, but a minimum is a 5.1.2 configuration, meaning you have to add the ceiling speakers. The sound is positional, not channel based.
Now, as for headphones. What the argument here is that they are 2 channel, and the surround audio is simulated. But what people are forgetting is that we only have two ears to begin with, so you could say that even a 32 speaker set up is still only going to be 'stereo'. Realistically, though, we know that if we hear something in front of us, it sounds different than what it would behind us, or above us. The technology behind the surround sound headphones takes those 'channels', or with the new format like your headphones, the direction of the sound, including sounds made above you. So far Star Wars Battlefront and Blizzard's Overwatch support Dolby Atmos. I'm not sure if Battlefield 1 does, I'm looking into that now as well.
Anyway, bottom line is all surround headphones are simulated, but so is all audio we listen to anyway since we only have two ears. With the headphones, it's just simulated for us ahead of time.
an easy little test you can do with any regular headphones is to download Razer Surround. It's a program that will convert the audio for any stereo headphones and turn it into a 7.1 surround system and has a test button where you can see a circle and shows where the sound you hear should be coming from in relation to where you are, and it rotates 'around' you. You can easily hear the difference, and it will make it sound like there really is sound coming behind you from these stereo headphones.