Which way to go to built a music server??

Hi Guys,

may I ask you for your opinions on how to best set up a music server? I am currently exploring a few different ways and anyone of them does have its weaknesses.
Obviously I have yo get a DAC which is fact. I am looking into a few and at the end it is a matter of how much money I want to spend. The main issue is how to feed the DAC! All my files are Apple Lossless.
I use Martin Logan Odyssey speaker, Krell FPB 450 monos, a KCT pre-amp all with Crystal cables.

The ways I am thinking of are:

1) Use Apple Airport express and connect APExpress via Toslink cable (with mini jack adapter on one end) to the DAC to get the digital signal into the DAC. Would be the cheapest because I do have the cable, the APExpress and an iPod touch to control iTunes via remote on the WiFi network.

2) Use Squeezebox Duett and get the digital signal also wirelessly from the Server and feed into DAC via interconnect (RCA or XLR etc). Digital files is coming in via WiFi and there might be some disturbance especially during rainy days and thunderstorms.

3) Get a SlimDevice Transporter which is a DAC and a Squeezebox in one unit. (I have to buy in US no one carries in Singapore as far as I know). Saves me to buy the DAC and the Squeezebox but in case of any warranty issue I face problems. Still the signal travels via WiFi....

4) Get the Wadia i170 dock and get the digital signal out of my 160 GB iPod Classic into the DAC via interconnects. Safe way to get the digital signal transferred to the DAC but choosing songs is not so easy because I cannot see the small iPod display from my listening position. Even a small monitor does not help because Wadia transport does not transmit the UI to the monitor.

5) Get an iMac (is cheaper than the Mac mini with display) place it on the rack (I do have the space) and use the iMac as a server. Via front row I can choose songs and browse the library. The DAC will be connected via USB to the iMac 20" and the digital files are streamed into the DAC. This is a more expansive solution but solves most of the issues. I can watch TV series from iTunes store, browse the iTunes library (and see everything also from a distance) and feed the DAC directly via a cable.

Now the question is what is the best way for the sound? I could not find much info in regards to USB connections? I am in favour of solution 5 with the iMac due to its versatility (can use the iMac also for other things when not streaming music)

-Are there improved USB cables available or only the of the shelves ones?
-Is a USB connection better than an optical or RCA connection for the digital signal?
-does the wireless streaming of a digital signal has any impact on the final sound?
-Should I pump more money into the DAC or into the server (iMac or Transporter or Squeezebox)?

Finally I am keen to hear your opinions about the DAC's I am looking at and how they would rate with the above in mind:

Cambridge DacMagic

Wadia 521 (no USB port - means have to use Toslink cable with mini-jack adapter to get the digital signal - but that connection could spoil the sound of which the Wadia should be capable of and renders the higher investment useless compare to a cheaper USB DAC)

Aprilmusic Stello DA 200MKII

Benchmark DAC 1 USB

Slim Device Transporter

Thanks for your comments and helping me to reduce my confusion.

Best regards

Ralf