CDP or DAC?

500 cd's sound like something you could rip. I would go that route. Either buy a server that can rip directly or buy a small computer (if you don't have one) for ripping and a server for playing music. Add a good dac if that is not built into the server.

If you don't want to rip everything then I would recommend a CDP + dac.

Personally going through the same decision. After thinking of options over a long time, have come to the conclusion that I am going to audition the new Esoteric K-05XD (and 07XD) when it comes out later this year. The K-03XD has gotten rave reviews, but it’s out of my price range ($15K). You might want to consider it. I came to the conclusion since I thought that for $7.5K-10K (not sure what MSRP will be exactly for the 2 units), you get probably the best CD transport on the planet, plus a phenomenal DAC. Only downside is they are not separate. But it does have all kinds of digital inputs, including USB (but not IS2). Part of the reason I’m going this direction is that I do want an SACD capable transport, there aren’t many, I think just PS Audio and McIntosh. And with each of those, you essentially have to go with their DAC to get the proprietary hand-off for pure DSD.

@fred60, I have the new PS Audio PST SACD transport connected to my Holo May KTE using I2S.  The Holo May KTE has 4 user selectable I2S configurations and Alt #2 works without a glitch with the new PS Audio transport.  I've played both regular CDs and SACDs with no issues.  The sound of this combination is fantastic!

@bobheinatz, I highly recommend the Holo May KTE and PS Audio SACD transport.   You'll be able to play CDs and SACDs plus if you want to get into streaming later, you can do that as well.  The May has 2 I2S input connections as well as USB, coax and a few others. 

I have a highly tweaked streaming setup:
Router extender > Triode Wire Labs ethernet cable > Finisar SM Optical transreceiver > Sonore Optical Module Deluxe with Uptone LPS 1.2 linear PS > OS fiber optic cable > Finisar SM optical transreceiver > Etherregen with Paul Hynes SR4T LPS and AfterDark OCXO clock with its own Paul Hynes SR4T LPS, Triode Wire Labs ethernet > Aurender N100H > Curious Evolved USB > Innuos Phoenix USB reclocker> Curious USB > Holo May KTE.  All components are connected to my Equi=Tech 2RQ balanced power conditioner.

I stream Qobuz with the above setup and the SQ is excellent as it should be given the plus $15K cost including the May KTE.  The PS Audio SACD transport and the May KTE are $11.5K and they will provide sound that is a bit better than my streaming setup (I think).  I'm also a analog guy at heart.  I have a Rega P10/Apheta 3 and a Linn LP12 w/Ekos SE arm, Radikal PS, Keel chassis, with the Luxman EQ-500 and Zesto Andros vacuum tube phono stages.  My digital streaming setup and my PS Audio transport/DAC compete very well with my analog setup.  So if you're looking for a CD transport/ DAC setup that will complete with your analog system, I highly recommend PS Audio SACD transport and the Holo May KTE DAC.  I also considered the less expensive Jays Audio transport but I wanted the PS Audio's SACD capability and the cost difference wasn't a big deal for me. 

@jond 

so yes if ARC has backup transports that’s good but if they don’t you're basically out of luck

one quick email to greg c at arc will take care of this, he can confirm yay or nay

Everyone seems to pitch what they own...the Luxman D10x is the endgame player for me...best digital I have ever heard or owned!