Cubase Elements 8 won't connect output Audio Device

I’m on a PC Laptop, Windows 8.1 64 bit
I just installed Cubase Elements 8 32-bit version (because my Waves plugins are 32-bit and I can’t change that - please don’t ask me to).
The installation loads “Input audio devices” but not “Output audio devices”.
When I look in VST Connections, I see that Output Devices are “Not Connected”. When I click on that “Not Connected”, I see the “Generic Low Latency ASIO Driver” listed but I can’t select it: when I click on it, it’s as if I did nothing.
When I open the Generic ASIO Low Latency Driver “Control Panel”, I don’t see the output device (“Speakers Headphones Realtek …”) listed. BUT if I un-check “Allow ASIO host application to take exclusive control of selected port configuration”, I see the output devices. If I then click “OK”, it’s as if I hit “Cancel” - nothing changes: the Device Setup doesn’t show the output audio devices and I have no output.

What can I do to make Cubase connect the Output Devices?