If you are using the built in SPDIF out then you typically don't need to disable the PC sound card, although this could vary depending on the hardware configuration.
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Thank you Rives! I have been considering the PS Audio Digital Link III for a DAC since it has XLR balanced "outs" and I did look at the Creative Sound Cards as you suggest - they come highly rated but I agree with your assertion that a high quality external DAC is the way to go. Am I to assume that by using the digital SPDIF out for an external DAC that I am effectively bypassing the PC sound card or would it be necessary to disable the PC sound card first?
A high quality external DAC will improve the sound quite a bit. There are two ways to do this. Some PCs have digital SPDIF out. In this case you can just buy any audiophile DAC--something like the benchmark would probably be a good choice. It's pretty inexpensive and works very well. If there is not a digital out, then a USB soundcard would work well. The Creative ones work well, but they are really designed for gaming and surround mostly these days. You would probably be happier with something that just does 2 channel and does it well, such as the M-Audio cards. There's a fasttrack pro and an audiophile. Either of these would probably be good choices.