SPDIF signal starts out electrical, in coax that is spit out natively. In a Toslink implementation, that electrical signal is converted to an optical signal, which is then converted back to electrical on the receiving side. The receiver receives the PCM as the same electrical signal regardless of how it was transported.
Think of water. Now fill two trucks. Freeze one of the trucks so that the entire payload becomes ice. Drive both trucks to the destination. Thaw the frozen truck. Deposit the "now all liquid" water into a couple of reservoirs. The man that walks up to you and tells you that the frozen water is now broken is the same guy that will tell you that coax SPDIF sounds better. It's an insane, uneducated opinion that holds no relevance to the real world. Unfortunately, crazy people tend to be the loudest, so their word tends to spread a little further given a smaller support base.
If you want to join the crazy people, then be my guest. All I'm recommending is that you maybe realize the paranoia and insanity before joining the coax SPDIF cult.
Furthermore, if there is a potential issue, it is jitter or wander which is inherent to the SPDIF standard regardless of transport type. Not something to even be concerned about, but a concern of far more merit than "coax or Toslinks!?!1one".
An additional concern, and one far more worthy of consideration, would be whether your intended receiver will even accept a 32khz bitstream. You can't assume that any random SPDIF capable receiver will accept the extremely odd 32khz output of the SNES. I'd look at the specs of the intended receiver before even bothering with the SPDIF mod in the first place.