A wireless router and a Squeezebox Touch is the perfect solution. The wireless router plugs into your computer and the Touch plugs into your DAC.
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The Airport Express or an Apple TV device do just what you're describing, as long as you're using iTunes to manage your music files on either a PC or a Mac. You can use up to three Airport Express devices at once. I've got one in my living room and one in my basement taking a wireless signal from the Mac in my office.
The port on the Airport Express or the Apple TV outputs a digital signal through a mini-Toslink connection, which goes into a Toslink input on your DAC, assuming you have one. An analog signal is available from the same port by using a mini-stereo plug but the quality won't be as good as using the digital signal through a decent DAC.
The retail is $99 for either box and the Airport Express is usually available refurbished from the Apple Store for $69. If you don't need the wireless router functionality of the Airport Express the Apple TV is probably a better deal since it does all kinds of other cool stuff, as well.
Mabonn - I have good results with MacMini -> Airport Express -> short glass Toslink -> Benchmark DAC1.
Two possible problems for you would be limitation to 16/44.1 and loss of lock between songs (nature of Airport Express). Some DACs are sensitive to loss of digital stream during gaps (Benchmark is fine) but it can be remedied by elimination of gaps by crossfade in Itunes.
In addition, AFAIK Apple express receives data in ALAC format. I also store data in the same format to save space and to avoid conversion.
During installation of such devices you might be asked question if you want Apple Express to "join existing network" or start new network - you want to join existing network. Ideal would be to have 802.11n wireless since 2GHz is polluted by a lot of devices including microvawe ovens. My microwave oven operates at the same frequency as on of the wireless channels and I had to select different channel. Now it works without any dropouts or problems.
Apple TV is perhaps a better choice while price is about the same.
WOW, thanks for your responses !! It turns out I do have a Sqeezebox Touch, and I have a wireless network in my house. I have been using the Squeezebox for internet radio. Now all I have to do is figure out how to send music from my PC over the wireless network to the Squeezebox. Anybody out there able to guide me through it ? thanks