Umm, I had the same problem at first. Worse, I stupidly allowed Microsloth to update my audio drivers - and completely lost rear channel sound. Well, not completely, I could turn off Dolby Surround Encoding - then the rear speakers worked, but the sound was only an intermitent crackle. POS!
I made a mistake when trying to reload the proper drivers, and my system would not load winblows except in safe mode. I ended up having to go back to the restore point I created. But here's what I think I did to load my drivers properly:
1) get the latest drivers from Nvidia
2) remove all drivers via Control Panel's Add/Remove. Remove the devices in Device manager.
3) load the latest drivers from Nvidia, and reboot
4) allow it to reload all the devices
5) download the 2.03 drivers, and unzip them to the desktop
6) manually reload the 2 sound device drivers, pointing to the unpacked folder's "Audiodrv" subfolder.
7) reboot and pray
After this, my sound properly again, and I can also select a PC Speaker from the Properties window of the Audio Devices window. Hope it helps you out.
EDIT: I tested the PC Speaker volume control and mute, and it works!