I prefer coaxial. If you play an SACD disc it will output the cd layer only.
Cary 306 SACD professional - which digital output?
Are you sure it makes sense to buy a separate DAC? Not only will you loose SACD, but I see no why a new DAC will definitely sound as good or better than the one in your Cary. It is, after all, a very well regarded $8000 player. If you can't try the DAC first, it seems like too big a risk. If I'm not mistaken, I think the MSB goes for around $5-6k.