External DAC connection for Bluesound Node 2i (after "Another streaming newbie" thread)


Guys, just following recent topic raised by chuckccs, I found myself in similar situation because I was comparing Bluesound Node 2i sound via its analogue RCA output with its sound via external DAC (M2Tech Young DSD with external power supply). Difference was really marginal, especially taking into account additional cost of external gear (DAC, cable, PS). I connected Node to DAC via coaxial output, however not tried the optical connection. 
From those who got substantially better sound from Node 2i via external DAC I would like to ask which connection they used (coaxial or optical) and which cable they recommend, maybe also which DAC they used too. Thank you!
apanhc
I first used a Peachtree Novapre as a DAC and preamp. Improvement over the built in Bluesound DAC. .Smoother. More dynamic.I since upgarded to a RME ADI-2 DAC FS. More air and definition. 

I use a Wireworld Supernova 7 Toslink cable.

I use my Node 2 directly into Peachtree A220 power amp. This combo drives a pair of Magnepan 3.6 speakers extremely well. I found that upgrading to aftermarket Ethernet cables by Silver Sonic made a huge difference. 

I’ll concede that I haven’t yet tried using a separate DAC or a preamp for that matter, but since upgrading the cables I don’t have a strong desire to make more changes. I’ll probably look at an UpTone Audio Ether Regen given the magnitude of the changes made by better Ethernet cables.
Using a Dac Magic 100 via coax.  A lot more open and better soundstage than the bluesound node 2i alone.  The node 2i on its own might sound good if you are listening to some wireless speakers but in a halfway decent system it leaves something to be desired on its own.  Fortunately, had Dac Magic which I used with a CCA which didn't sound a whole lot worse than the node 2i when run via optical into DAC.  FWIW.  The aptx and other conveniences of the bluesound means I will probably keep it until I hit the number and can replace with something significantly better but ... it isn't the be all and end all of audio devices IMHO.
Node 2i to RME ADI-2 DAC via either Mogami coax (1.5 m) or a good quality but inexpensive optical cable. They both sound the same -- excellent. From the RME: balanced cables to the amp, or direct to phones.
Good info here, thanks much.  Can the Node 2i transport DSD files to an external DAC?  One of the reviews suggested problems.

I have ripped 100s of SACDs and only need a streamer that can best transport those DSD files to my DAC.   I am comparing this Node 2i to other solutions such as the Allo USBridge/DigiOne with their LPS.