er well the CD in is to connect the CD drive to the soundcard, so audio cd's data just goes straight to soundcard presumably without clogging up other system resources etc, and ensure minimal opportunity for interference. This is long time standard, all cd drives with have the audio out connector and all sound cards a connector for cd in. an internal cable. this usually comes with the cd drive though, unusual if you have to buy one seperately. some audio cards (i would certainly expect an Audigy) also have a digital audio in connector, and again id be surprised if your cdrom doesnt have the 'out' connector. soundcard should come with the digital cd-soundcard cable, tho i vaguely recall some murmerings about not being a good idea (check this out, i dont know).
as for the Radeon having a CD out.... er no idea (no big surprise for me really😉, sure it isnt a misspelling and meant to be a port for connecting LCD monitors? Only other use for a CD out i can think of is connecting computer to a hifi system, but again that is standard for soundcards and is just Line-Out (well, 'standard', theres a standard which all hifi's and soundcards support plus also many cards support AC3 on the line out [even SB 128's], so even if the soundcard itself does not support Dolby Digital or 5.1 decoding, then if the hifi is dolby digital/5.1 then you will still get that sound from the hifi. What this means is if you have a good quality hifi system, then just connect the comp to teh hifi for Dolby 5.1 sound with a fairly cheap sound card 🙂