Good review... I also have an Onkyo 5.1 I am happy with and new Turtle Beach X12 headset.
Not quite the fancy setup with optical though. I was about to get this cable, but I hesitated because others report the short circuit rebooting the Xbox (if you change TV inputs or cycle TV off-on) but maybe that is only using RCA connection. Then I noticed the Onkyo amplifier has an old-style stereo jack on the front for headphones. I would guess most surround sound systems would. I got an adapter 3.5mm to .25in stereo jack - it worked great. These are $2-3 and available at Walmart, Target, Radio Shack etc. Sound seems great to me- maybe if you are a purist you can tell me the stereo jack does not provide high fidelity or something. ;)
My TB X12 cable only allows about 2 feet separation between USB and audio (but I had a USB extension laying around) so it could be a tight stretch for some setups. Still like a $5-6 fix. May be obvious to some, but this alternative was not mentioned in the instructions with my headset. Just an idea.