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Fixed

The SPDIF connection has to go to another SPDIF connection. The SPDIF output from your computer to the SPDIF input on the reciver, not an analog input. Analog inputs only take signal from another analog device, usally using RCA cables.
 
Take one of the RCA cables and plug it into the digital out in the XFi. The connect the same color to the digital in on your receiver. Select the source you plugged into on your receiver (DVD, CD, DBS). That should be all there is to it. There are specific external decoder inputs on the receiver, they're all analog (they bypass any processing of your receiver). You can run the analog out from the XFi to the external decoder, but a better strategy is to buy 1/8" miniplug (stereo) to RCA (stereo) so you can pick up the other speakers aside from just your fronts.
 
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