I've run my Oppo through the excellent DAC of my Playback Designs MPS-5 with excellent results. The CD performance of the Oppo improved 90+% when used thusly. Hence, I think that you might consider investing in a good DAC in your price range, like the Benchmark or Bel Canto. With a good DAC in your system you can use it with other sources as well, like a server or iPod reader.
The transport is indeed important, but IMHO the DAC is responsible for a lot more of the performance, particularly in your price range.
Dave