any laptop has spdif output?

The easiest thing to do is to get a USB-to-S/PDIF converter. Both the Halide Bridge and the Musical Fidelity converter recently got a big thumbsup in Stereophile and TAS and are relatively inexpensive. They also support USB asynchronous transfer mode where the PC is slaved to the converter's clock which reduces jitter significantly. You will only need a converter if your DAC does not have a USB input or if the USB input as you say is limited to supporting 16/44 file formats. There are indeed quite a few USB DACs that support hi-rez file formats that you can connect your laptop to directly via the USB port. Check out Computer Audiophile (http://www.computeraudiophile.com) and The Well-Tempered Computer (http://thewelltemperedcomputer.com/HW/Connect/index_connect.htm). Hope this helps.

My Toshiba laptop (A505-S6980) has an S/PDIF output. All of the Toshibas in that line (A505-S69xx) have this output. This laptop also has an HDMI output making for a very high-quality connection to an external monitor...

-RW-

I, too, suggest going with an external USB-to-S/PDIF converter for best sound quality.
Get one with a good, independent power supply.

Even if the Laptop does have Toslink or even coax output, the jitter from these would be terrible. Much worse sounding than a cheap CD player/transport.

Steve N.
Empirical Audio

Steve what about an All in one computer then? Any better than a laptop?