Mac sound quality


I'm using the new IMac , burning my CDs in AIFF . Its hooked up to an audio grade power conditioner , power cord and run to a Levinson #360S dac from the digital out through a audio grade digital cable . The sound quality is not nearly as good as my mid fi CD player . Iv'e read many posts saying this type of hard drive is far better than good quality CD players , too many posts to disregard . What am I doing wrong , the other posters were down loading , but can there be that much difference ?
tmsorosk
Odd ... I am running the same DAC fed via a Windows box with FLAC files. The sound is at least as good and in some cases I feel its slightly better than my Wadia 23 CDP. It's pretty amazing. That being said, I am bailing on Windows and going to a Mac mini. I am also converting the whole collection to Apple lossless. I have tested the Apple lossless format files converted from FLAC and I didnt hear any difference on my Windows 7 box. A couple things you might try,

Encode a CD of MP3 files - as high a bit rate as you can and see if the sound improves. If the problem is transcoding to Apple lossless maybe the MP3 encoder will give better results. If it does improve, it must be someting in the lossless encoding. If not maybe your files are fine and it's an OS or itunes setting.

Do you have access to someone with a different Mac setup? Encode the files on a newer Mac and burn them to a CD then copy them to your Mac then see what the sound is like. I figure its something in the file encoding/creation OR in the playback stream.

Are there Apple based alternatives to iTunes? Might try a different player.
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4est . Settings were as you recommended , except error correction was off , does this mean all imported CDs will have to be reburnt ? I could not find the audio midi set . This is the newest Imac , could it be different ?

Thanks
I'm running MacMini, apple lossless with error correction ripping, usb connection to my amp and PURE MUSIC software....I couldn't be happier, I've got better than cd sound with the convenience of my my Itouch as a remote.
TOSlink out to the DAC is not the best way to go, but it should be at least decent. What are you using for a TOSlink cable?