Hi  I run my system through my ultralite to two powered krk monitors which sound great!
 
But today i'v ebeen gievn this by my brother inlaw for free...
http://support.logitech.com/en_us/product/z5500-digital-51-speaker-system
 
IS it possible to do the following... integrate the bass woofer as part of my setup top coexist with my krk?
 
and 
 
setting up surround sound using my ultralite?
 
any thoughts pro/cons?
 
Btw is spdif only stereo?

yes, you could set up the surround system through the ultralite (I have one as well).  it has 8 outputs you'd simply need to connect the rear speakers and the subwoofer to separate output channels from the front KRK outputs, then you'd need to set up the MOTU audio drivers to use 5.1 instead of stereo output.
 
your question about SPDIF being stereo only - yes it is.  the question seems completely unrelated to hooking up a consumer grade 5.1 set of speakers to the MOTU, tho - are you planning on using SPDIF in conjunction with this setup?  SPDIF will not carry 5.1 sound.

I have a UltraLite-MK3. 
 
Those are digital speakers you have. Some are not aware, but, actually S/PDIF can carry compressed surround signals such as Dolby Digital and DTS audio codec 5.1/7.1 signals. But S/PDIF can't carry true surround signal formats such as Dolby True-HD and DTS-HD. 
 
You will need a decoder though: (software (WinDVD, VLC Media Player, PowereDVD, etc.) or hardware (home theater receiver, for example)). 
 
I never had a digital 5.1 speaker set, but I think all you would have to do is set the Windows default playback device to the UltraLite S/PDIF output,  connect the UltraLite S/PDIF output to your digital speakers, setup the source video or audio to play the 5.1 signal (a DVD, for example), and set the Digital decoder (WinDVD, for example) to output to the S/PDIF output and play 5.1 or surround audio.
 
Hope this helps.

It's important to understand that S/PDif can only carry a stereo signal,  what you encode into that stereo signal is up to you, within the bit rate limits of S/PDif.
For 5.1 mixing/monitoring in your studio you need 6 channels of output from Sonar to your interface, which then needs 6 outputs to drive the speakers.  Some interfaces can be set to work in 5.1 mode, where the master volume control affects all 6 outputs.

Ok! Cheers guys... I will try to get around this setting up issue. found some manuals on the logitech site.

Ideally, I would like to be able to work in 3 setups.

Stereo. krk only.
stere with bass woofer.
Surround. with kvr as my front l n r?

edit above!

Elffin
Ideally, I would like to be able to work in 3 setups.

Stereo. krk only.
stere with bass woofer.
Surround. with kvr as my front l n r?

What you want is a PreSonus FireStudio 2626 with the remote control.  It does exactly what you're asking at the press of a button (I have one)
 
Unfortunately, it's now discontinued and declared legacy and isn't supported above Win7 (though I'm told it works with Win8)
 
If you can find an equivalent interface with all the features the FireStudio has, let me know please..