If your CDP has a digital out, I too would recommend adding a DAC. Audio Mirror, Scott Nixon, Audio Note, Bel Canto, and others make excellent DACs that are under $1000 (some at half that price), and you can get a good digital IC for $100. I think you will get better performance value from the component if going this route, and it also allows you the flexibility to run a hard drive-based system if you so choose.
Hope that helps.
Hope that helps.