Yes, everything works on the E35M1-M, including S/PDIF once you trick ALSA into accepting it. For more on the S/PDIF issue, I suggest that you read the splendid tutorial by rmkmathi here:
By following her concise steps I was able to achieve S/PDIF digital audio output to my 5.1 Dolby Digital surround sound stereo system. I am relying upon my external surround sound controller to achieve full 5.1 output. Linux itself only outputs 2.1 at this time via passthrough.
I also recommend VLC Player, because it seems somewhat better suited for ATI's gpu. Although some recommend XBMC I was unable to get it to work and did not really feel like wrestling with it. Many unexplained computer crashes without any error messages.
As for ATI's video driver, well it does seem to be a hassle to install the latest and greatest one, but I did it eventually, although you will notice two instances of the ATI Catalyst Control Center. One is the Admin version with more privileges and the other is the general version.
I cranked up the manual overclock on the BIOS to 111 for better performance. You may need that because I'm not sure ATI's Linux driver or VLC player takes much advantage of the AMD GPU. I rather suspect it does not, but as I do not play high def video I have not suffered too badly. I don't think I'd want to give 1080p a try, but 720p might be possible at very low quality settings.