Roon software consists of three parts - server, endpoint, and controller. The server is what manages your music library (either locally stored on a hard drive and/or streamed from Tidal and/or Qobuz). The controller is the part that provides the user interface (typically run on a tablet or smart phone, but can also be run on a Mac or PC). The endpoint is what connects to your audio system.
The Nucleus (or NUC running Roon Rock) can operate as both a server and endpoint. As an endpoint, it only has USB output.
There are numerous other devices that can operate as Roon endpoints by using ethernet (either wired or wireless) to transfer the data from the server, and that connect to the DAC over SPDIF, AES3, USB, optical and/or I2S, or that include a DAC built in. Probably the most popular is the BlueSound Node 2i because it offers a lot of bang for the buck ($500). It includes a built in DAC, but can also be connected to an better external DAC. But there are many other options from companies such as Lumin, Auralic, Bryston, Sonore, Sotm, just to name a few.
Roon generally recommends that the Nucleus be used as just the server, with a separate device used as the endpoint. This is because a device optimized as an end-point can be simpler and generate less digital noise and therefore theoretically deliver better audio quality. The USB output port on the Nucleus is not optimized for audio. This doesn't mean it won't work, but will probably be compromised compared to a reasonable quality streamer/endpoint such as from one of the companies listed above.
Many better modern DACs put in a fair amount of effort to make their USB inputs less sensitive to noise and jitter on the signal, so your mileage may vary. It's quite possible that a given DAC will sound as good or better connected directly to the Nucleus than using a modest quality streamer/endpoint,
There are also now devices that are designed to be used between the USB source and the USB input on the DAC. These are basically USB bridges, but they buffer the USB signal and output it on a USB output optimized for audio. An example is the Sotm tx-USBultra, or the newly announced Denafrips Iris and Gaia.
Bottom line is that there a lot of ways to slay this dragon, and there are a lot of factors that affect the quality of sound you'll get. Adding a good quality LPS to the Nucleus will definitely help the quality of the USB signal generated if you choose to connect this way. Even if you connect over ethernet, it will still have some effect, although perhaps not as significant.
I'm wrestling with the same issues in my system. I have a NUC running ROCK which is currently connected over wired ethernet to a Bryston streamer and then to the DAC over AES3. I have an LPS on my NUC and am wondering myself whether I should invest in a good USB cable and try a directly connection to my DAC (Denafrips Terminator) which supposedly does quite well with USB input.
