To hook up the Z-5500 to the Audigy 2 for digital you need a "mono" adapter that is a 1/8" male on one end and a female RCA on the other. Then just plug it into the Audigy 2 SPDIF jack and plug a 75 ohm coax cable (with male RCA jacks on both ends) to that adapter and the other end into the Z-5500 control panel.
You can get both the adapter and coax cable at Radio Shack. That's where I got mine. I first made the mistake of getting a "stereo" adapter and it does not work (no sound). After reading a forum and seeing my mistake, I went back and got the "mono" adapter.
Now I have both analog and digital and freely switch back and forth between them (through the Z-5500 control panel) depending on what I want.
A few more things.
As mentioned already, make sure the Audigy 2 is set to "spdif bypass" to disable the Audigy 2's decoder.
Hook up the Audigy 2's three analog outputs to the Z-5500 control panel also (to be able to switch between analog and digital anytime you want).
Do not check the "digital only" box in the Audigy 2 control panel (if you do you will only be able to have digital and not analog).
To have Digital from DVD's, you also have to disable the decoder on the DVD software (I use Cyberlink and have the spdif checked in the speaker settings which disables all the settings below that, which the Z-5500 will then control).
Be sure to have that digital wire connected inside the computer from the DVD player to the Audigy 2 (or you won't have digital. The analog wire is not needed because the analog signal goes though the PCI bus on Windows XP).
Use analog for all games because EAX does not work through the digital connection.
BTW, don't worry about the speaker test on the Audigy 2 control panel. It does not work correctly for the digital connection. It will only sound through the 2 front speakers. Dunno why but that's just the way it is. The Digital plays correctly through the 5.1 speakers when the source is 5.1 digital.
Do not have the CMSS checked in the Audigy 2 control panel. Let the Z-5500 control panel do all that.
That's it.
I scrambled through all this myself when I got the Z-5500's. All I can say is I'm happy as a clam now and slightly deaf!
I have all the options I could possibly want. Playing a stereo source I can have stereo (both fronts), stereo x 2 (all four speakers) and then have a nice option of Dolby Pro Logic (simulated 5.1 sound from a stereo source or even a mono source). True 5.1 sound from a DVD movie or DVD audio is only available from a digital source so to get that benefit you have to have the digital connection (Dolby Digital or DTS Digital). 5.1 sound through analog is available from games. If the game has 5.1 sound, set the Z-5500 control panel to "Direct 6Ch Direct" and you will have it (like Farcry for example being in that ship and hearing all the creaks and pops coming from all around you is incredible). If the game does not have 5.1 sound, this setting will only produce sound through the front 2 speakers. If this is the case, you still have the stereo x 2 (4 speakers) and the Dolby Pro Logic (simulated 5.1) options.
I can't imagine anything sounding any better than this. This PC system sounds better than my home entertainment center, it's that good.