Apple TV setup with Harman Kardon

• You could use HDMI instead of S/PDIF (Apple TV → TV → receiver). That may have less re-encoding, although I doubt that most users can hear a difference.
• You could have the AV receiver as hub in between the TV and external player boxes (Apple TV → AV receiver ⇄ TV) [ARC between AV receiver and TV]. That could be beneficial if you have more devices to switch between and have use for extra HDMI ports. Video passthrough may be limited to the specifications of the AV receiver, so probably 1080p SDR for your model, which is fine when that matches the TV. If you also use the TV without HDMI input through the receiver (e.g. antenna/cable directly), then the AV receiver in the middle requires ARC ports on the TV and receiver. If no ARC ports are available, and the receiver isn’t used for video input, then better set up as Apple TV → TV → receiver instead.

Harman Kardon Dolby Surround 5.1 system

Can you give a model number, so that we may look up specs?

My TV is attached to my HD

Did you mean Harman Kardon? Else what is “HD” referencing?

My Apple TV is connected with the TV with HDMI, and in settings my structure changed to Dolby Digital.

That is recommended when using S/PDIF.

My question is, is this the best way to connect my Apple TV to my TV/Surround?

That will work perfectly fine. There could be other solutions if the audio system has HDMI ports. But if it doesn’t, then your setup is as good as it can get.

Audio-Output: only option is TV speakers, not my AVR

This is as expected. “To TV speakers” means here: over HDMI. (In contrast with AirPlay or Bluetooth speaker connections.)