Apple TV 4K Keeps Cutting Out - How Do I Fix This?

I have been able to solve this problem on my own ATV4K after a lot of troubleshooting. There is a small compromise but it is working for now.

My setup:

Sony 2018 55” 4K TV which supports HDR10 and HLG. ATV4K connected to HDMI3 which supports 4k HDR/HLG and Onkyo receiver connected to HDMI2 which supports ARC and 4K HDR/HLG. ATV connected using HDMI certified ultra high speed 2.1 cable and receiver connected using HDMI 2.0 cable.

My Troubleshooting:

1. I tried switching my ATV4K with another same gen ATV to see if it was my particular ATV which was faulty which was not the case. The other ATV showed the same issues.
2. I used the fastest available HDMI cable to avoid any bandwidth bottlenecks. Used an HDMI certified one as an extra measure. Again, did not change the situation.
3. Tried the two ATVs on a different brand (Samsung) TV while also checking that the wifi range was similar for both TVs. Samsung TV showed no such problems. Then hooked up the ATV to a friend’s Sony TV form 2017 and had similar problems.
4. When hooked up to ATV HD instead of ATV4K, all three TVs worked without any problems. It appeared that the problem was specific to ATV4K and Sony TVs together.
5. Then Tried upgrading to a higher internet speed in case that was a problem, although that was probably not the cause since my current speed supported multiple 4K streams without significant buffering or lag. As expected, did not mitigate the issue.
6. My final attempt was to check if it was a problem with the port itself. I changed ATV4K output to HDMI2 and disconnected the receiver temporarily. Playing videos no longer caused any cut-offs.
7. My receiver doesn’t support or at least, doesn’t detect standard HDMI as an input method, so I later hooked the receiver to the TV using optical cable. Still supports 5.1 audio, although at slightly less audio quality. I ran a video for 7 hours with this setup and noticed no cut-offs whatsoever.

Conclusion:

Current setup is ATV4K connected to ARC HDMI2 port and receiver connected with optical cable. With this small compromise in audio quality, I was able to watch a full episode of Loki in 5.1 surround audio without a single cut-off or dropped signal. Significant upgrade from the previous anxiety causing and brunt-of-all-jokes expensive setup which worked like a $200 Walmart TV.

Next Mission: Get HDR to not look like gray s**t on my HDR10/HLG supported TV.