which output setting sounds best?

Ditch Vista and go Win7 64 bit if your laptop is less than 2 years old; Vista is badly flawed for audio fidelity. I A/B'd Vista Ultimate 64 bit vs Win7 Home 64 bit and Win7 was much better for fidelity. However the hardware architecture of your laptop will limit you as Cerrot implied. It will do fine if you have a playback system under $1500 but for more expensive systems, Mac options or other designed by intent music server will deliver better what you payed for.

Win 7 combined with Wasapi is the proven winner and yes, you'll hear the difference with your HRT... upgrade when you can and for now, enjoy.

By the way Bob, I don't know if Cerrot has heard a Music Streamer II +, I haven't but I've read a solid 50 different people say that it is a wonderful bang for the buck DAC...

Cerrot, did you hear this or a Music Streamer, Music Streamer Plus, Music Streamer II, Music Streamer II+ or iStreamer or Music Streamer Pro.
From What I read the II+ is head and heals above anything that came before it and is still a very nice upgrade over the standard Music Streamer II.
I've seen it Comared to many $1000 DAC's with good reviews.
I hear Kevin Halverson of Muse fame that created the music streamer product has some nice improvements coming out right now.

I haven't heard it. From the reviews, I wouldn't have an interest. The interface doesn't work for me.

I bought an Emotiva XDA-1 dac which replaces the HRT. Music from my laptop sounds much better now, not compressed or flat and I am also running my Sony SCD777ES sacd player (redbook only) through one it its coax inputs. My system is very revealing as I have almost 25K worth of components.