is it possible to use the analog outputs of the virus but still retain the use of the usb VC?

Yes, open the VC. Go to Common tab and change the output.

I believe it's simply nothing more than an option, you may have outboard gear you wish to put it through instead of any plugins for example?

"better" is subjective. i have spent a lot of time researching this, and the answer is "it depends"
if you use an inferior soundcard with poor D to A conversion, you may hear a difference. It will be slight though.
Also if your soundcard doesnt have reliable drivers, this may be an annoyance with high latency.

In my experience, the Virus TI has EXCELLENT D to A converters and the outputs always sound great to me.

For me, i have ALWAYS used the 1/4" outputs to go into my external mixer. With this method, i get no latency, reliable ouput, and it frees up my soundcard to do regular duties.
I am using an RME Fireface 800