System Sound Output, the default format, outputs analog audio that plays on your computer's built-in speakers, stereo headphones, or other audio device.
Digital Out outputs digital audio and doesn't use the built-in speakers at all. It works with devices that support the S/PDIF format. Digital Out allows you to use a home theater system to play back 5.1 audio. If you use Digital Out, the volume slider is always at maximum and grayed out, because the volume is controlled by the receiver or speakers rather than by the computer.
To use Digital Out, your audio equipment must support S/PDIF. You might need to install drivers required by your audio device. Contact the manufacturer of your audio device to determine whether you need to install drivers.
To choose the type of audio output you want to use within DVD Player:
To choose the type of audio output you want to use from System Preferences:
If you choose Digital Out Output, DVD Player uses the digital output device you choose regardless of the settings in the Sound pane of System Preferences. In fact, the volume setting on the computer will be ignored as the digital sound out volume is controlled by the audio device.
If you choose System Sound Output, DVD Player uses the audio output selected in the Sound preferences pane.