DAC vs. New CDP

"If you go with a DAC, you will have the added cost of getting a quality digital cable and power cable (They do matter, IMHO) and also have to store it on an additional self."

Not exactly - if you need better power cable for DAC then you need it for CDP as well - no savings here. I agree about digital cable, but with upsampling jitter rejecting DAC like Benchmark cable quality doesn't matter (Benchmark tested it with 1000' of cable)and you can get the cheapest one in Radio Shack or make one yourself (as I did). Next - you can sell Clasee CDP and buy $70 DVD player (as I did). Very good tracking and MP3 playback.

My previous CDP was Cambridge CD4SE - one of the best Cambridge ever made but transport failed. Combination of DVD player with Benchmark is hands down better (clarity, transparency). If you can spend more try Bel Canto DAC3 - also jitter rejecting (I think)and a little fuller sounding. Both have reviews on "Stereophile" website. They like DAC3 a little better (for twice the cost) but Benchmark was once "component of the year".

Question for all the "dac" people.

If someone was looking for an across the board improvement, and had the budget, wouldn't it make the most sense to address both the dac along with the transport? There seems to be little concern given to the sound quality of the transport.

Goatwuss - There are two schools (as usual). One says - get asynchronous upsampling DAC (jitter rejecting like Benchmark DAC1) and cheap transport since the only virtue of the expensive transport is lower jitter while the other school says - get NOS (non oversampling) DAC and better transport.

Cost wise first solution is better and that's what I did but you'll find many audiophiles who like NOS better. It is personal/subjective. NOS DACs are not as common as oversampling or upsampling DACs but you might like them.

No contest on this subject to me. IMHO the dac is everything in the final sound and transport really doesn't matter. I just got a bel canto dac3 today and it is phenomenal. I ran various cd players into it and you cannot tell any difference no matter the cost. Cables and power cords don't seem to matter much with this unit. Unbelievable soundstaging, imaging and definition with a nice warm sound. No digital nastiness whatoever. Get one. It is worth every penny! My next steps will be to set up a computer, digitize my cd collection and use a squeezebox into the dac. My wife is gonna be happy since there wint be cds everywhere and so will I because it will sound so damn good! This is the future and most flexible option long term.

Swanny - these upsampling DACs have so much jitter rejection that cables or transport don't matter and your Bel Canto confirms this. The only type of transport that will sound different is the one that is not "bit transparent" by means of DSP processing or digital volume control. As long as all bits are there there is no difference.

Goatwuss - I forgot to mention savings on digital cable with upsampling DAC and good digital cables are not cheap.