I use spdif to add two more mic inputs by using an external stereo mic preamp that has spdif outputs.
Some guitar effects processors have spdif output. I have used the spdif output of a GT-8 to record the guitar without having to convert to analog.
One time I connected the spdif output of my audio interface back to the input to make a loop back.
The purpose was to capture and record audio from the internet onto my DAW.
Send the windows audio out to spdif then select the spdif input on the DAW set to record mode. Make sure input monitor is off so you don't get a feedback loop.