You really should try the USB sound out. It's great! I bought a second Joggler to hitch to my hi-fi for Squeezeplay and can now play my Spotify playlists with great sound (premium account users only for the Spotify plugin).
I had a "eureka" moment earlier this evening and have fixed my problem. Previously I created the etc/asound.conf file in 'gedit' using the following steps:
Create new file > paste in the USB soundcard code (found at the beginning of this forum thread) > save as 'etc/asound.conf'.
The above steps worked in the previous image but not this one; then I thought that the character encoding might be wrong and, sure enough, the file was not the same as other 'conf' files. I then noticed that XBMC, was playing through USB and it has its own 'asound.conf' file at /usr/share/xbmc/system/asound.conf. I copied this file to /etc, opened it (sudo gedit), deleted the xbmc code, pasted in the USB soundcard code and saved.
Voila! USB sound working in Squeezeplay after a re-boot.
The USB sound card I use in the kitchen is this one:
http://cgi.ebay.co.uk/External-USB-7-1- ... 1c19a9d793
I don't know how it claims 7.1 sound with only a stereo jack but it works well - certainly well enough for the kitchen.
The one I use with my hi-fi was bought years ago and has SPDIF out. The optical connection to my amplifier takes Joggler sound to a whole new level. I can't recommend any USB soundcards with optical out because I can't see my old one for sale anywhere. You'd have to take your chances but anything with a C-Media chip should work (both of mine are cheap cards with C-Media chips).