The CAT setting that's often spoken of is that for the FT-817; you're using the FT857 settings? Is there an advantage? Not that I care ;) just interested in the options. I'll obviously have to plug it in and try.
Belthur [I don't have your proper name, sorry],
With the CAT control, you won't of course need to worry about rig keying, vis a vis PTT as we sometimes do in these cases. You may wish to attenuate the radio audio output that goes to your computer sound card or US$7 dongle of which Evan speaks. An easy attenuation is a 100-ohm resistor across the shield and center of the headphone output, and a 5k to 10k resistor in line with the center as it proceeds toward the laptop input or dongle input. This is off the top of my head, and other sources show something like this:
From experience, it wouldn't hurt one bit to place a 600-ohm to 600-ohm isolation transformer in line with the Line Out side of that, and I would be heavily tempted to put a 10k potentiometer on the Line Out side of that diagram as well, and then into the transformer; failing a trim pot on the line out, I'd still go for a 100-ohm for R2 above since you're delivering to Microphone levels, NOT line level.
The times I've made up stuff like this, I've done well to make up the same arrangement for the opposite direction for the computer speaker output toward the radio mic input, while following Evan's advice about plug contact-wiring of course.
Another source for the transformers, here.