You are correct though, you need to have hardware support as well.
So what I take away from this is the best drop-in sound card to run for most scenario's as an end-user (someone who who plays lotsa music of all types, movies and TV shows of all types, and dabbles with audio at a personal consumption level) are the CMedia X-Fi equivalent cards, then? (I forgot what the chipset ID's were sorry. CMI 87xx?)
What about the onboardies? Are they super fine, even for output to A/V recievers?
AFAIKnew the audio chip's are/can be bypassed and the reciever handles the audio muxing, sampling amping etc which how it should be if you are using one!?
I'm personally looking in to two seperate ways to do HTPC properly, with one being a micro-HTPC set up like a RaspberryPi or even Gumstix-sized approach for car and caravan installs etc, and a traditional Mini-ITX for more grunt and permanency in the home. I am trying to minimise power use, and provide maximum support with hardware (TV's, receivers, audio and vga) and media types (avi, no4, aac, mov etc).