Here are a few differences:
1. Upgraded transport
2. Newer version of the Anagram chipset
3. Much beefier power supply
4. Better chassis construction
5. Higher quility volume attenuator
There are quite a few other changes as well.
Sonically I hear increased frequency extremes. More air on top and better control and depth in the bass. The resolution is also quite a bit greater.
While I am a dealer for Audio Aero, it is obviously in my best interest to justify the MK II over the MK I, however, I can tell you that if money is tight, the MK I is INCREDIBLE!
The current Prima DAC is not close to the Capitole MK II. A future release may change that.