connect laptop to main system

The Logitech Squeezebox is a good option. The Squeezebox offers good sound and you don't even need the computer to listen to internet radio or music services such as Pandora, Rhapsody, etc.

agree with cruz and if you can spare a few extra bucks, the duet is a great option. this will give you a remote with a screen that shows cover art and menu to navigate. the squeezeboxes are fantastic devices.

Since you said you didn't want to spend hundreds (e.g. no Squeezebox), a simple solution is a USB-Optical converter box like the Behringer UCA-202. They cost generally between $40-80. You can also get a modified one from the Tube Audio Designs website.

Another option is to get a cheap soundcard and use the digital-out to a good DAC. I wouldn't recommend using the analog out of a soundcard, unless you go for a pro unit like the RME Fireface.