Okay, maybe it's just my lack of comprehension here, so Souliarc, as you know more about this whole thing, explain it so I can understand it:
The audio is being recorded on two ordinary microphones therefore creating standard two-channel audio.
The audio is then played back on two ordinary speakers, producing stereo sound.
At what point do we apply algorithm A and how does it turn normal stereo sound into weird 3D true positioning sound, and how exactly does it do that considering that the microphones that recorded the original sound can not differentiate between different sound positions in relation to any axis except the one that connects the locations of the two microphones?