I would suggest you consider an outboard DAC and pay particular attention to Johnny Darko's DAC index and comments on CD playback . 16 bit music can be irritating on a poor recording but if well recorded a good DAC will allow you to enjoy it. Some DAC designs accentuate the shortcomings of 16 bit recordings, others are at least neutral. Up-converting to me = equalization... you gain improvement in one area and loose in another
http://www.digitalaudioreview.net/the-darko-dac-index/
http://www.digitalaudioreview.net/the-darko-dac-index/