The trick is that your 3.5mm connector only needs to connect on the sides, so the end of the jack can be open for light to be transmitted.
This was seen pretty frequently on laptops for a while, but I think two things doomed it. One, most people just don't use optical. Two, there's nothing to advertise its existence. If you do have one of these ports, you probably don't even know you could plug an optical connector in there.
---