Pros & Cons of Buying an Integrated with Built-in DAC?

I agree with ADG - get the best sounding integrated amp you can, and then add a separate DAC.

I've been using a Meridian 263, from about 1992, and it is still very good musically/sonically.  The downside is that it won't work with any newer formats, but since it was effectively free I don't really care. 

Good, inexpensive DACs are all around these days.  Don't limit yourself by trying to put everything in one box unless you really have to. 

Very happy with Hegel H80 in second system. In five years I will either sell it or buy an external DAC.  Easy either way.

If simplicity and convenience matter along with good sound, there are some very good choices available out there.

I bought a BelCanto C5i (true digital amp with DAC and phono) as an experiment to test the downsizing option in my second system and gotta say this unit is absolute top notch and competes well with separates.

60 w/ch is really its only limitation but if very high volumes out of less efficient speakers is not required, you are golden.

I agree with the above posts that you should buy the best possible sounding integrated amplifier that matches your needs and purchase a separate DAC.  Based on current market conditions, it seems, that DAC technology is constantly being upgraded (mostly new chips) while amplifier design, generally speaking, changes less frequently.  

I suggest you separate these two functions so that you have the option to upgrade either the amplifier, or the DAC, as your system and interest requires.  The separation of the amplifier and the DAC into two boxes maybe more expensive but will be worth it, in the long run, when you decide to upgrade.  There are many separate quality DAC's on the market today in many different price ranges that should work for you.  The separation of the amplifier and the DAC will give you the most audio system "flexibility" for future system upgrades and improvements.   

Thanks to all for your input. Clearly, the consensus is that I should not go the "Swiss Army Knife" route. 

onhwy61: no- I have no reason not to go with an integrated. In fact, I prefer it.  

hgeifman: my original rationale for considering an integrated with a built-in DAC was that I wouldn't have to buy a DAC in the future, should I be compelled to switch from CDs to downloads/streaming (not a change I want to make at present). However, your post has revealed the fault in my reasoning-- the fact that DAC technology is constantly changing strongly suggests any  DAC bought today will be outmoded by the time I might switch my source format-- the very outcome I was hoping to avoid! Thanks for setting me straight.