Well, I know it's a Gigabyte thing for sure, it's right in the manual and I've always had to disable it anytime I've used add-on audio cards.
Of course, I'm no audio pro (Don't care), so maybe I've never tinkered with it the right way, and I've also only tried with one speaker source anyway?
For my speakers, I could only use one or the other, and HDMI audio via ATI was so tiny a gnat would squint to hear it. << And that may be the same issue the OP is having, I bought a cheap card to get around that, but have since went back to onboard. I only use speakers for mail notifications, or the occasional tech video, so it doesn't really matter to me how it's setup as long as it's working. I just dropped my thoughts here because it seemed like no one was mentioning this, and I had experienced similar with HDMI audio.