I have the SC connected to the coaxial on my receiver. What you need:
1 * Normal RCA lead (think only requirement for digital is it is 85ohms, most are fine)
1 * 3.5mm -> 2 RCA converter
SC --[ >------------------< Receiver
^ ^
converter rca cable
Take one end of the rca cable, plug both (red/white) plugs into the converter, plug the 3.5mm part of the converter into the SC
At the other end of the cable you will have 2 rca plugs, 1 is Dolby Dgital only stream and the other is the equivalent of a normal soundcard line out (ie it outputs everything) I use this one. The output from this cable is 48kHz pcm (same a CD data but at 48kHz)
Hope that helps.