I'm doing the same thing with a mini PC (aopen) of the same form factor running Vista and media center... Just purchased a Bel Canto Dac3 (TTVJ) and a Van Den Hul Opto Link II mini to toslink (from Eugene Audio in Eugene OR - these are hard to find..hence the shameless plug). The Dac3 has a balanced output to drive a nice 2 channel rig (mine's a Krell 400xi). I run applelossless (ALAC) and wavs into this gear. Sounds pretty good so far. I'm still tweaking though.
mac mini
i've burned some of my collection lossless to my mac mini....what's the next move in order to hear them through the master system...i would like to hear them as close to perfection as possible....thanks, brent