Funny you should ask...
This subject is pretty much covered in this recent thread in the cables and interconnects forum.
http://www.audioholics.com/forums/showthread.php?t=4547
In my opinion, the last sentence from this excerpt pretty well sums it up.
“Today the TOSLINK optical interface has reached its sonic performance potential. What changed? There are three factors that draw the line separating mediocrity from excellence: purity of the optical conductor, clarity of the optical termination (lens), and flexibility without signal loss.
When each of these parameters is optimized, and the interconnect is used with quality components, the TOSLINK connection is audibly indistinguishable from coaxial S/PDIF.”
But, you might want to read the entire article to get the whole picture.