I switched out the 'TOSLINK' over to a standard coax and the sound is much better - not on par with the Recon 3D card, but it's an improvement. I am using some Logitech speakers and not headphones.
That is surprising. If anything, I would expect the toslink signal to be superior as it is completely galvanically isolated. Is it possible that there is dirt affecting the signal, either in the sockets or on the plugs?
Possibly. Another thing that could be is that I damaged the cable (somehow) when disconnecting it. Or, the Realtek TOSLINK has some design/implementation flaws.
I switched out the 'TOSLINK' over to a standard coax and the sound is much better - not on par with the Recon 3D card, but it's an improvement. I am using some Logitech speakers and not headphones.