If he insists on using digital out, then Soundstorm is his ONLY choice for multichannel gaming.
No other audio chip, Audigy/2/ZS included, can encode multichannel audio information into a digital output stream. Period. There's no way to transmit uncompressed 5.1 over a single digital cable and only Soundstorm can encode multichannel audio into a single Dolby Digital stream that can be transmitted over a single digital cable in a way a receiver understands.
Audigy2 ZS DOES offer superior 3d audio features (it uses even less CPU, and it provides even better 3d effects) but it limites you to stereo over digital or up to 7.1 using analog only.
The KT400 is no real slouch of a chipset. nForce2 will give him a performance boost, though, at stock settings, if he has a pair of identical DIMM modules to run in "dual channel". If he only has one single stick of RAM, the nForce2 will provide some, but not much speed boost (2-5% tops).
Generally speaking, a Ti4600 will be the limiting factor in most resolutions, so the CPU/chipset combination becomes less relevant, especially with EITHER Soundstorm or an Audigy2 card.
Also, swapping motherboards requires a windows format and reinstall. You CAN do a "repair install" but there's a good chance it won't work, and it still requires a lot of time to remove the old, now inactive chipset drivers, which necessitate removal of a lot of other drivers (i.e. video card drivers that are installed differently depending on the GART drivers provided by the chipset manufacturer. So you're getting rid of chipset, video, sound, LAN, storage, USB, etc drivers, all while the computer is in a fairly perilous state) So factor in a day for backup, format, and reinstall if you upgrade the mobo. Factor in an hour to remove sound drivers, installing an Audigy2, and installing and updating its drivers.
So.. MY suggestion is an Audigy2 and lots of 1/8" to dual RCA cables. But an nForce2 MCP-T will do too.