Scott is right... Today on PC's it is NOT possible.

There is a provision to start to get digital headphones supported in Longhorn.

Bottom line is DSP's with HW 3D Audio WILL be standard on all PC's by 2005... Hope is that a standard for either USB passthrough OR digital headphones with a more flexible (from a plug in plug out perspective over optical) will come forward.

Have you looked at using the optical Sony's I mentioned