CDP breaks and I move to computer-based...

Maybe, maybe not...
Computer audio isn't really as easy as "just ones and zeros".
First off, IMO toslink sucks and has always given me inferior performance over usb/spdif. USB implementations vary as well. Most likely though there is some other problem. Instead of telling us that you have it set correctly, tell us how it is set and what type of files you are using and whether or not you have tried using the cpu as a "player" and not a server by letting the disc play through the cd drive and not being ripped then played.
Did you break (lift) the cpu ground?
What mac, what os, what player (iTunes?)
What is going on in the cpu background?
Did you renice (re-prioritize) the processes using terminal or process wizard?

From what I have seen, it takes a pretty good transport to beat a server, and that something simple is wrong...YMMV

Computer is a Macbook Pro notebook with 4 gig ram, running the latest version of OS X. I am using iTunes with all iTunes processing (EQ/soundcheck,etc...) turned OFF. File format is apple lossless. In terms of background processes, I wouldn't think that this would be an issue on an OS like OS X, which is known for being stable. I have not compared playing the cd on the drive but I will try that. BTW, this setup is for my headphone rig, which may matter or not, but I thought I'd mention it.

Again, since the cdp is not functional I cannot a/b test. I am fully aware that I could be imagining a difference that is not there, or an incredibly slight one if it is. What I am leading up to is the decision to purchase a new transport, or instead commit to computer-based audio and get a Squeezebox Touch.

I would rather stick with PC audio for the convenience or access to thousands of songs.
What if you have a jitter problem? You could try an affordable re-clocker, like the Monarchy DIP, run toslink into the DIP and then digital coax into your DAC. What was the CDP you were using as transport before?
Memory and processor intensive software, like Photoshop, Final Cut, Form Z, or 3D games, etc., could affect bit-perfect audio playback, even on an OS so perfect as X...