A few questions about DAC basics


I have been making a few upgrades to my system and a friend suggested that I consider a decent used DAC as a good upgrade. He was not really sure if my CD/DVD player could use a DAC. He has very high end equipment and has separate transport/DAC etc. Guess he hasn't slummed it with off the shelf integrateds for awhile:)

Here is my system:

My system is:
Denon 5 ch DTS receiver (1801)
Parasound 1000 hca amp for the fronts only
RBH Sound 61SE fronts
RBH 661SE Center
Polk Audio S6’s for rears
ACI Titan Sub
Pioneer Elite DVD/CD player DV-C36
DH Labs T14 silversonic speaker wire
Tekline TL 2000 RCA interconnect from the Denon L/R preouts to the Parasound amp
Glass Toslink digital cable from Pioneer to Denon

My first question is can I add a DAC to this system?
I am assuming that the Pioneer d/a converter is what I am using now when I play CD's.
I have coax, optical and regular RCA outputs on the Pioneer.
Presently using a Glass Toslink to the optical in on the Denon. The Denon has two optical ins, a digital coax in, and several RCA analog pairs in, as well as additional Ext. in for 6.1.

My second question is more like several and I apologize if it is too simplistic. From reading these forums it seems that an external DAC is connected from a digital output from a CD or DVD player and then has outputs that go into the preamp, or in my case the Denon DTS receiver. Does the DAC connect to the preamp via analog in or digital in to the receiver?

I am also assuming that the DAC handles the digital signal in such a way as to improve or expand it? I read stuff about upsampling, etc and it sounds very interesting.

Another question I have is what happens when I am playing a DVD? This is where I start to get confused.When I am playing a DVD right now, the Pioneer sends the DTS or Dolby Digital signal to the Denon for processing into 5.1.
Does adding a DAC still allow this process? I mostly listen to music, but still want to watch movies in 5.1 dts or DD sometimes.

Finally, is this a reasonable upgrade for this modest of a system, and do you have any suggestions for around 3-500$ used?

Thanks for your input and patience. I have improved my system quite a bit from the info on these forums and appreciate the expertise here.
lkdog
Lkdog,
I must caution you against buying a new DAC for your system. My return to 2-channel audio was through home theater, so I went through a similar process to yours. I enjoyed watching movies, but my primary focus was music, so I wanted to improve my 2-channel (music) performance.
Unfortunately, budget-minded receivers like your Denon AVR-1801 do not have an analog bypass circuit. In other words, your new DAC would output an analog signal which would then go into your receiver. However, the receiver converts all incoming signals back into digital to allow for digital volume control and digital surround processing (DTS, Dolby Digital, etc.) Thus, you are still relying on the DAC in the Denon for the final analog signal that will go to your speakers.
If you are serious about improving your music performance, I would look into a good, used 2-channel pre-amp to use with your Parasound, thereby taking the receiver out of the 2-channel loop. You can then input the DVD player (or new DAC) into the preamp, and connect the preamp to your Parasound, then the speakers. The movie output (via the TOSLINK) will still go to the receiver for processing and then the center and rear channels. I hope I am not confusing you, but you really can have the best of both worlds (with some compromises, of course).
If this is a larger bite than you can chew right now, a simple, cost-effective upgrade would be to buy a good-quality, used coaxial cable to connect your DVD to your receiver. I think you will find an improvement over the TOSLINK.
I realize that the complexity of combined HT/2-channel setup can get confusing, but it can be done with decent results. These are some of the lessons I learned (the hard way) when I was in your shoes. I have since seen the light, and have whole-heartedly converted to the purity and resolution of 2-channel! Can I get a witness? AMEN!
Enjoy your system, and remember - HAVE FUN. Good luck.
Mark
Mraybeck - Thanks for the info on your experience. I am trying to be careful about which route to go. I appreciate the info. I had been wondering what role the Denon plays with any signal that comes into it-digital or analog.
Obviously to do the DSP junk (which I do not use) it has to be grabbing the signal and processing it. For Home Theatre one wants it to handle the signal in 5.1, but for stereo I would just as soon it left it alone and let the D/A from the Pioneer DVD/CD handle the duties.
Getting the Parasound to bypass the Denon power amp for the fronts made a major difference.

I think I understand what you are saying about the input signal from a DAC being then "reprocessed" through the Denon surround circuitry.Probably defeats the purpose.

What about this from the Denon manual: ????????

Playback using the external input (EXT. IN) jacks
"Set the external input (EXT IN) mode"
Once this is selected, the input signals connected to the FR,FL,C,SL, and SR channels of the EXT IN jacks are output directly to the fronts,center,and surround speaker systems without passing through the surround circuitry"

Is this what you mean by an analog bypass circuit?

As far as the toslink, I was using a cheap plastic toslink.
I didn't know any better. I then did some reading here on Audiogon and just got the SOUND Professionals Glass Toslink.
Major difference is sound clarity, depth, space, and actual volume of the signal. I do, however, want to try a decent coax and compare. Most people smarter than me seem to prefer a coax to a toslink.

Let me know if this EXT In thing has any merit. I never really noticed it, or thought about it until lately. Supposedly this Denon can use a totally different processor if one wants to do so.

I have thought about a separate preamp, but where do the speaker wires go for the fronts. They are presently connected to the Parasound. I am a little fuzzy on this point. This si the discussion that my forend and I got started on that led to him stating to try a DAC rather than try and configure a preamp with my existing system. He maybe assumed that I has analog bypass (which I might if the EXT IN thing works as I read it).

Thanks.
Lkdog,

The EXT IN is perfect, except that if you are using the Sub out from the Denon it may be useless when using the external DAC. I have the same situation with my bottom of the line Onkyo HT receiver, but I find that the music is so much better sounding through my Polk RT25i's with all processing off that the lack of really low bass is acceptable. But then again I have a separate substantial 2 channel system to fall back on!

The only subs that I know of that can be hooked up simultaneously with 2 channels (in the case of your EXT mode) and an LFE (subwoofer) channel are some of the REL subs (e.g. Storm III). Anyone else?

Good luck.
Lkdog,
That does sound promising, that passage in your owner's manual. I tried to get your manual and the spec's from the Denon website, but I was unable to do so. I do not know for sure if your particular model does have the analog bypass or not. I'm sorry if I am confusing matters. The Denon receiver that I previously owned (one generation earlier), did convert all incoming signals to digital. I was told by a very knowledgeable local dealer that this is commonly done in entry-level receivers because designing a volume control in the digital domain is much cheaper than a good, quiet analog control.
As far as integrating a preamp, you would still have the receiver power your center and rear channels. However, you connect the FR and FL preouts on the receiver to a R and L line level input on the preamp. The preamp then sends to amp, and from the Parasound to the speakers. With this arrangement, the preamp needs to be on and set to a reference volume level when calibrating for 5.1 channel audio.
I did this exact same upgrade 3 yrs ago, and the improvement was not subtle for 2-channel (even given the fact that the preamp section of my Nakamichi receiver was actually pretty decent).
Check your owner's manual - you may have a block diagram of the signal path in it.
Good Luck,
Mark
Thanks guys. I am learning a lot.
I may give Denon a call to confirm the info in the manual.

Mrowlands- I left out what it said about the sub jack in the EXT IN group of RCA in jacks. It has a SUB IN and this signal is routed to the regular RCA pre out that I have my sub in now. I guess I would put the sub conncetor into the EXT IN Sub In jack and it would route it correctly when listening to two channel.

One more dumb question. It has dawned on me from the discussion here that my signal out of the Pioneer Elite DVD/CD D/A is then being reprocessed by the surround circuitry. AM I correct in assuming that I could route the RCA outs from the Pioneer Elite ot the EXT IN jacks and bypass the Denon surround stuff? I could leave the toslink in place for when I wanted to do HT.
My guess is that the Pioneer DCA is better than what is in my Denon. Here is what the Pioner manaul states about the transport and the DAC:

CD Mode for Full CD Changer Functions & Video Off
High Speed Loading and Resume
10-bit Video Signal DAC 96KHz/24-bit Audio DAC
Hi-Bit Legato Link Conversion
Dual User Memories
Twin-Wave Laser Pickup for CD / Video CD / CD-R playback
Viterbi Error Correction for Superior Reading Accuracy

Other than pushing a button and maybe having to switch the sub cable this might be better two channle than now even without a DAC.

I think am going to try autditon a DAC if the EXT IN thing will work. I will call Denon.

Thanks to all.