USB-S/PDIF Converter or USB DAC?

I've decided it's time to use a music server with my main system. I currently use one (iBook) with my headphone system with the Grace m902 headphone amp with built-in USB DAC. I intend to get a new Intel iBook when they are released (March/April).

I currently have an unused Wavelength Audio S/PDIF DAC that I could use with a USB-S/PDIF converter (such as Empirical or Red Wine Audio) or get a USB DAC (WA Brick, Stello, ???). Is a dedicated USB DAC preferred over the hack USB-S/PDIF converter route?
Thanks, I'm going the USB DAC route. I actually had an early Cosecant, but did not use it much at the time so I sold it. But now computer audio is really useful for me and I like the character of Gordon's DACs. I'll probably spring for the Cosecant.
Budrew -- fyi, since you sold your Cosecant, he's come out with a new version -- same guts, but he tweaked the cosmetics -- check his web site. -- David
Does anyone have any experience or opinions about Toslink to coax converters (maybe it's an adapter and not a converter)?
What is the maximal reasonable length for USB connection? AFAIK after some length you have to put USB repeaters. It won't distort the data, but it may mess up timing, isn't it?