Has anyone tried this?

I have digital cable with all those music channels like classic rock, and golden oldies. The musial variety is really good. I was wondering if anyone has run a digital cable from the box to an outboard DAC? What were your results? The music claims to be CD quality but I think its compressed. Would a DAC make a difference?
I've got satellite and the stations are compressed. I can tell this even though my sat receiver is connected through analogue outputs due to the fact it doesn't have a digital out. It's an old receiver : ) Sean
I run Direct tv toslink digital out to a GW Labs digital converter, then to Audio Note 3.1 balanced dac. Results were startingly good, only problem was the dolby digital stations don't seem to come through properly.