@geekl33tgamer
thanks, i thought my motherboard had that capability.. its an Asus Rampage III Extreme with an onboard HD sound card..
that also helps to explain why the 5.1 works when i use my GTX 570's HDMI for audio... i guess new Nvidia cards are capable of encoding audio?
@w1zrdf1ngrz
yea i thought about trying that option but it seems like a shame that i have a 6ft optical cable going unused

the other thing is that when the optical input is selected on my receiver i use a 7 channel enhancer for music and other stereo signals from my PC, but when 5.1 is being sent i just use a PureDirect setting that sends the signal it receives straight to the speakers without any effects.. when you use the multi channel inputs it disables the enhancer so it wont spread music to all the speakers
btw its a Yamaha HTR-6290