Cambridge Audio 740C Optical In DAC Help...

1st time I've ever posted here. I've been consumed online of what to do... I have 3500 CD's and an old Onkyo CD Player. I'm using Paradigm Studio 40s and just bought the Onkyo TX-NR609 Receiver. I'm wanting to get a laptop (Mac Pro- or any other recommendations?!) and download all of the music into iTunes (or something else?!). I've been reading about a lot of DAC's here, but thought I would kill 2 birds with one stone and get the Cambridge Audio 740C Cd Player with the Toslink Optical In and hard wire connect the laptop to that and use it as a DAC. IS this difficult to do? If I do this, can I play other audio through the computer or video and have it not go through the DAC? Will the Onkyo recode the music after it goes through the DAC defeating the purpose? Would I listen to the Computer in CD Mode on the receiver and just change the input or would it be under PC (if I was using the PC as a component?) Any other recommendations? I want to get the best possible sound, get a new CD player and use a laptop for all of the downloaded music. I appreciate anyone's guidance, but also understand if you avoid this post altogether!!! I'm a rookie...
We have the Cambridge 840c, which I think has the same input options as the 740c. I have often used this both as CD player and also fed it from my MacBook (and also my Airport Express and MacMini) via the optical Toslink, without any problem.
You need to switch between sources on the Cambridge, but otherwise don't have to move any cables.
You do need the special optical cable connecting from the 1/8" combined audio out port on the Mac to the standard Toslink input on the Cambridge.
I didn't pay much attention to the difference in sonic qualities between CD and the computer sources due to the reportedly higher jitter associated with the optical connection, but didn't find that route much inferior and certainly worth listening to, given the convenience.
And you can later always upgrade that path by switching over to the USB->SPDIF route: we now use the M2Tech HiFace, going from the Mac via USB and the HiFace into the SPDIF port, mostly to allow higher sample rates than Toslink supports on the Mac.
sounds great. i was at one time obsesssed with having all my cds ripped into computers and ipods and backup hard drives but surrendered. it just is not necessary to me as i have 3 computers, 5 hds, 1 dvd player, 1 cd player, 1 sacd universal player and 3 classic ipods/with docks and thousands of cds. stuff everywhere haha. for serious listening i use my mac and pure music or pc and foobar2k. loading 3500 cds is going to take you bit of time but there are some benefits of having everything at your fingertips and the sound guality of computer audio is really nice.
Could you please look at and record your software version of the 840c?

I have an 840c and it is UNUSABLE with an Airport Express because of jitter issues.

I'm just trying to find out if the expense of updating the players software is worthwhile or not.
To do the update, you need a Null-Modem and a computer with the right (Windows) OS and a serial port.

Other than THAT? The wireless link from the confuser to the stereo is terrific. The Ipod touch makes a good remote and everything works seamlessly.

You don't need a 'special cable' either......A simple Toslink to mini-Toslink adaptor works fine. The cost for such an adaptor? 2$ tops. and that's too much.
I own the 840 c and use a first generation apple tv. All the music is on the drive,no streaming. you do need a video source and itunes .But for the $100 bucks it works well. I cannot notice a difference between the apple tv and playing a disc .