Digital Audio Server

I think that the best way to accomplish this is to set up a remote audio server and spool the audio files to your amp or dac with a digital audio receiver. They range in quality and stability, but one that I have used flawlessly for a couple of years (and indecently runs on Linux so no windows or Mac) is an Audiotron. A complete list of DAR’s currently on the market can be found here http://www.andrew.cmu.edu/user/kb13/mp3/
There are a number of major advantages to this setup:
1. All files are stored on a remote computer or NAS network storage device such as http://www.lacie.com/products/product.htm?id=10073 by lacie, thereby allowing for easy upgrades and additions in memory. Having plug and play storage devices is essential if you wan to keep you files in WAV format to avoid sound degradation. A number of NAS come with auto file backup so you can rest easy at night knowing that your 80 gigs of sound files are safe and secure. Incidentally 600 CD’s stored in there native format is around 360 Gigs. Even more reason for you to go with an NAS
2. No distracting fan noise. If you do however want to locate a PC close to your audio gear there are quite or fanless PC such as this one made by Hush http://www.logicsupply.com/
3. A digital audio receiver allows you to use a high quality DAC to convert digital to analog. The worse thing you can do to sound quality is to use an internal PC sound card. A CPU produces so much electronic noise that with a good set of head phones you can hear your hard drive startup up with an audible buzz even whilst listening to the sex pistols.
4. A number of DAR’s can be controlled through third party hardware such as PDA’s or for that matter any PC on you network
I have a pretty rudementary setup but it should give you an idea of wahts possible http://forum.audiogon.com/cgi-bin/fr.pl?vstrt&1074394694&read&3&4&

Get a Mcintosh and use iTunes. It's the easiest and best option. You can go with a G5 desktop with a large hard drive. It has an optical digital out. But what I would recommend is get a basic iBook and a large external hard drive (I would start with at least 200 GBs, you can always expand the storage space in the future by simply getting a larger hard drive). The iBook takes up a lot less space than the G5. You don't need a ton of RAM since presumably all you will be running is iTunes which comes with the iBook and will meet your needs perfectly. When you rip or play a CD it connects to an internet database to look up the album info and enter it for you. You set iTunes to rip the CD to the external hard drive and turn off all of iTunes default equalization so the sound is not touched. With the iBook you can output through the headphone jack (the lesser quality option, but still adequate) or use a USB DAC which is the better option (there are a few currently available, but more on the way soon). Wavelength Audio makes a great tube-based, zero sampling USB DAC, but it is pricey ($3500). There are far cheaper USB DACs available.

This system is not expensive and is easy to use, fully expandable and very convenient. I've set this up in my home office and have really fallen for it because it is so convenient. I can play any CD instantly.

I tried to use laptop with a M-Audio Sonica Theater USB card with my DAC. I find the sound is not comparable to Theata transport.

My long term solution is to use an external HD (200G) with laptop as an alternative audio source, but seems I need to reconsider it.