Hi Andrew,
Audio Toolbox is indeed the product to use for real-time audio applications.
At a high level, in addition to the ability to stream audio from and to sound cards with low latency, Audio Toolbox comes with a library of tunable filters (graphic EQ, param EQ, lowpass/highpass/bandpass, etc) that are ready for use. It is also possible to author your own tunable algorithms.
Audio Toolbox has support for both MATLAB and Simulink, and it is compatible with other products. Note that the Audio Toolbox algorithms are capable of generating C/C++ code for MATLAB Coder, and you can eventually deploy your application on hardware. The product supports audio plugins, but you can absolutely use it to target other devices.
I suggest you refer to some of the online examples of the product to get more information about its capabilities. These links might be of particular interst to you: