I made a little headway last night. I found Xear 3D control panel installed on the computer and some of the settings there were overriding the Windows playback settings.
Using Xear I set the output to Spdif but now I only get sound with PCM and the sound stutters badly. I've plugged into a Yamaha YSP800 which should support Dolby Digital, DTS and PCM. There is no sound at all when I play a DVD.
Can I disable either Xear or Windows CP so I only use one or the other not a bit of both!