There's no simple answer. I recently auditioned three new one-box solutions compared to my current separates. It was pretty much a toss-up. The systems were all under $4,000.
The advantages of separates are that you can spend $5,000 on the DAC alone and then upgrade the transport later. The DAC upgrade will likely make your system perform better. Some recent articles in Bound for Sound also suggest that separates allow you to introduce even more specialized components that help control jitter, etc. The downside is that the signal is traveling through more electronics, but I'm not convinced that's as important in digital as in analog (analog includes the preamp and amp, btw).
If it were me, I'd try some high end DACs to see how they work. I would then upgrade the transport later whenever that is possible. A couple of audiophiles I trust have been absolutely raving about the Teac reference series, so I'd suggest you give that a try (I know ... I never would have thought of them either).
The advantages of separates are that you can spend $5,000 on the DAC alone and then upgrade the transport later. The DAC upgrade will likely make your system perform better. Some recent articles in Bound for Sound also suggest that separates allow you to introduce even more specialized components that help control jitter, etc. The downside is that the signal is traveling through more electronics, but I'm not convinced that's as important in digital as in analog (analog includes the preamp and amp, btw).
If it were me, I'd try some high end DACs to see how they work. I would then upgrade the transport later whenever that is possible. A couple of audiophiles I trust have been absolutely raving about the Teac reference series, so I'd suggest you give that a try (I know ... I never would have thought of them either).