VIA Announces Open Source Driver Initiative
Not a proprietary cable, just a DVI to HDMI cable that I picked up off the shelf of a local retailer.
This is the card in question: http://usa.asus.com/products.aspx?l1=2&l2=8&l3=634&l4=0&model=2051&modelmenu=1
It would appear that the card is able to detect when a DVI to HDMI cable is being used (the TV indicates that it is connected via HDMI), and sends audio out over the DVI port. (Some Radeon HD cards require the dongle, others, like this one apparently, do not). Since HDMI does not have any dedicated audio pins, the audio has to be encoded as part of the signal (and research I have done seems to indicate this).
So, a bastardization of the DVI spec, yes, but the HDMI spec, no. All the card is doing is treating the DVI port as an HDMI port (HDMI contains a subset of the DVI pins, so it's kosher).
And yes, I double-checked my PC, there is nothing connected to the audio ports. :) There's also no internal connection needed, as the video card has it's own sound processor.