I'm about to delve into this stuff as well so am very interested in this thread. From what I understand you can run your lossless digital file (WAV or AIFF) from your hard drive via a USB to SPDIF convertor into virtually any DAC with an S/PDIF input. Assuming it was recorded as a lossless file at the appropriate sample rate (or greater), it would seem to me that the quality of the output signal will then be solely dependent upon the DAC and not at all on the hard drive. Am I incorrect in assuming this? By the way, You could further convert the signal from S/PDIF to Toslink with yet another simple converter if your DAC only has a Toslink input. All these converters are available through RAM Electronics, or some other favorite electronics retailer or etailer. I would like to put the most listened-to part of my CD collection on an external drive that I can bring from home to work. Anyone figure out how big a drive you'd need to hold, say, 200 CD's as WAV files? Are those files indeed "lossless"?
Marco