Once you install all of your drivers (including the Intel chipset driver and Realtek Audio Driver V6.0.1.7023) you will need to select the S/PDIF as your default audio output in the sound control panel playback tab (the digital out optical choice), then your optical out port will be active.
I would download the latest drivers from
HERE.
Your front panel case header must be attached to the AAFP port to attach anything to the case front ports. If your case has two attachments -- AC97 and HD Audio, use the HD Audio to attach to the AAFP port on the motherboard.