newbie DAC question

Am I missing something here? Is there something wrong with your Music Hall integrated? I thought you were simply looking for a DAC for your CD player and for streaming. Seems you have accomplished that. 

Though your system is a budget one, at it's budget I believe it to be well balanced and capable of providing much musicality for the dollars spent.
Congrat yourself and enjoy!

Wherever you heard that the differences between dacs and interconnects would be "HUGE"...you should stop going there.  They've been telling you tales of Bigfoot and the Loch Ness Monster. 

The limiting factor in your case (setting aside the room, which may be perfect for your setup, we don't know) is your speakers.  There's nothing wrong with Elac speakers - they're great for the money.  But at the end of the day, they're $300 speakers.   I'm not saying they're bad speakers, not in the least, but encouraging you to swap dacs, or upgrade your interconnects, or playing with coax vs. USB vs. whatever is barking up the wrong tree.  Doing those things may affect the system (though I doubt it, as you've discovered), but the sound will still be coming out of $300 speakers.

If you want better sound, put every dollar you can into upgrading your speakers.    And if you're emotionally attached to the Elacs, or simply can't afford to upgrade them, then forget about this thread and enjoy the music you have now.  Playing with those other things is a waste of your time and money, and frankly I'm surprised I'm the first person on this thread to even mention a speaker upgrade, though I know it's not the question you asked.

@mesch there is absolutely nothing wrong with my amp! In fact, I LOVE my Music Hall. I think I was too influenced by the likes of Stereophile, Steve Guttenberg, etc the last couple of years as I've gotten more heavily into audio. Maybe DACs, interconnects, power conditioners, etc have a big effect on systems costing 10's or 100's of thousands of dollars, but I am beginning to doubt these same things will produce a noticeable difference in cases like mine (and anyone else who won't spend more than $1500 for a single setup).

@bcgator I completely agree with you. When I'm ready for an upgrade, my speakers will be the first target! However - I have never enjoyed music more than when listening to those Elacs. I am constantly amazed at how much I love them. So I'm not yet in any hurry to replace them. 

I'm in complete agreement with both of you. Also a little disappointed that the mainstream publications or authors seem to have lost touch with these observations you've made... It appears to me that these "audiophiles" are doing their passion a disservice this way.

Without the Valhalla 2 cords feeding my Sutherlands, the perfection I spoke of earlier began to come apart. The effect produced one of those puzzling "Did I hook something up wrong?" moments. Pachelbel's Canon in D was once again the disjointed mish-mash it had been before I first installed the Valhalla 2 loom. Violins again sounded aggressive and edgy, even in their lower ranges. The individual elements of the recording, so distinct and clear with the Valhalla 2s in the system, now bled together into something wide and deep, but incoherent and inconsistent. Any sense of musical tempo or flow vanished; at best, when a simple passage would emerge, the adjective I found inescapable was strident.

That's an excerpt from a recent Stereophile review of the new, $85,000 line of Nordost Valhalla interconnects, cables, and cords. This is basically a paragraph telling readers how sucky his $100,000+ system sounded without the $6,000 power cord. It's this kind of thing that I think throws noobs like myself off. These kinds of articles make it look like there are HUGE rewards to be reaped by upgrading EVERYTHING in your system to the max. While that might possibly be true for an extremely expensive and revealing system, it is definitely not the case lower down the food chain. 

http://www.stereophile.com/content/nordost-valhalla-2-reference-cables#D65M2bWQtqLyEEMv.97

It's not just this hobby either, kremrik.  In a society, and financial system, based on consumption rather than savings, the goal is to get you to spend more and more, consume more and more, and to always be chasing the next acquisition.  This industry specifically wants you to never be happy with what you have, to always assume that spending more money will make the music sound better, and that you're always one more upgrade away from musical nirvana.  The "keeping up with the Joneses" dynamic is alive and well here, just as it is with home ownership, auto ownership, and numerous other consumer categories.   You, like each of us, have to know when to say enough is enough.