Several questions you asked there, I'll try to answer them all, others hopefully will respond & improve on them.
"I've heard that on-board sound isn't a great option for those that want high-quality audio"
On board sound is what you make of it. There is plenty of software available to shape sound. Read some of Soundman's posts, he is one that has taken the software route and done well with it.
"so I was wondering if using an optical-output (going into a 4.1/5.1 amp) would give me just as good sound capabilities as an upgraded USB sound device"
If you have a digital signal that you need to get to amps etc. optical is a great way to do it. The signal can travel great distances without picking up any stray noise and cabling is much smaller especially on multi-channel setups. To my knowledge, if you are not converting the signal to analogue at the PC, then quality coming out of the digital out is less of an issue because one of the most important pieces is the DAC and you won't be relying on the main board to handle that. Regarding 4.1/5.1 amp with optical in, there is a very detailed thread on that here if you search, they are tough to find especially new which means your other option is a hardware based DAC with or without processor.
"I also hate when you put a CD into a home theater system and you barely get sound out of the rear speakers."
That is generally the way a properly decoded multi-channel setup is suppose to work; during a movie, the rear channels only are heard when someone drops a plate in a restaurant behind the person in the scene or a plane flies over and as it passes over head and moved behind the person,the sound of it fades to the rear channels. Surround sound is not suppose to surround you in sound, it's intent is to create as realistic sound stage as possible. If you want it for music it'a a waste of time, most music is only recorded in 2 channel so to get sound to the rear speakers you just duplicate the channels from the front to the back.
"Lastly, will I need any other hardware or anything to get good sound out of my setup? Any help will be really appreciated as I'm not too educated on audio with as far as computer hardware."
Entirely up to your goals and budget, software solutions are the lowest cost and lowest impact on the interior of your vehicle. Some hardware solutions will likely give you the best possible sound but only if a lot of other vehicle improvements are completed with it. Sound dampening, high quality speakers, good amps,etc.