I agree with Drubin.
Keep the squeezebox 'as is' and get yourself a really nice DAC. I own both the Squeezebox and the Transporter. The Transporter has a marvelous DAC which is a bit too analytic for me so at first I piped it into my Audio Aero Capitole's DAC for a certain warm musicality. Now I am using the DAC in my Anthem D2. Both the Squeezebox and the Transporter are great ways to stream music over the web and they interface really nice with my G5 Computer's iTunes. While both the Capitole and D2 are more expensive than you are wanting to spend, there are many really good DAC units for a whole lot less money.
Keep the squeezebox 'as is' and get yourself a really nice DAC. I own both the Squeezebox and the Transporter. The Transporter has a marvelous DAC which is a bit too analytic for me so at first I piped it into my Audio Aero Capitole's DAC for a certain warm musicality. Now I am using the DAC in my Anthem D2. Both the Squeezebox and the Transporter are great ways to stream music over the web and they interface really nice with my G5 Computer's iTunes. While both the Capitole and D2 are more expensive than you are wanting to spend, there are many really good DAC units for a whole lot less money.