Digital direction

I have a Music Hall CD25 CDP and am thinking about upgrading. A couple different paths to choose from:

-Have it modded by Part Connexion for $350
-External DAC under $1000 (Perpetual,Bel Canto, MF etc)
-Move up a notch to a better one box, Arcam CD23, etc.

I love the HDCD playback and want to keep. I also want to keep expense around $1,000 or under. My initial thought was to get the player modded, and then down the road when the SACD/DVD issues settles (and there are more releases), get a middle of the road SACD/DVD player and keep both players. Thus, I have decent CD/HDCD playback and will also have SACD/DVD playback. Will a DAC on my player make much difference?

Any comments or other thoughts?

1. speak to Michael Percy from for the internal upgrade path and compare with partsconnexion.

2. don't bother with external DAC under $1k.

3. by adding $1k to your existing sold player you can get realy great one-box such as ARC CD1(not sure if it's HDCD enebled but... just stop paying attention when the music sounds great anyway!).

4. don't upgrade at all and wait till you get $2k. the more you wait the less money is spent for an upgrade.
I wouldn't go external DAC under $1000, but if you decide to, look at a Birdland Audio Odean with volumn control.

but if you're in this price range and want a killer one piece player. Try a used BAT D5. It's so not digital. You'll be able to play every CD and say wow!
Bel Canto DACs are very good. All my HDCD discs sound very nice via this upsampling dac.

My advice is stay put and do not invest $$$ in the digital format for the time being. Use the available fund to buy a decent turntable/arm/cartridge and start exploring the world of analog LP playback.