USB DAC or USB to SPDIF conv. + non USB DAC?

I've been thinking about the Peter Daniel option as well. For all of my hand wringing, please see this thread:

http://forum.audiogon.com/cgi-bin/fr.pl?ddgtl&1227466952&openmine&zzMusic_prof&4&5

Thanks for all the replies.

I wound up getting the Giga Lab USB Moon DAC from Pacific Valve for $210 including shipping. This is an NOS DAC and it does impart a sound slightly like tubes. It also has coax and toslink inputs. No headphone stuff. Well worth the price.

I also discovered that my Soundblaster Live! 5.1 card does have a digital out: its a 3.5mm into which I can plug a mini > optical toslink adaptor(under $2 at Parts Express). Haven't tried it yet.

The digital output from any Soundblaster card is abysmal. Asynchronous USB is fast becoming the new standard.