If you can go for a break-the-bank solution, why not do it? If I could, I'd get a DAC which could handle 24/192 over a FireWire interface. That, along with a Mac, iTunes and Amarra Mini would make me very happy.
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DACs are funny beasts in that many of the under $500 units are really quite good and it will take a sizable outlay to really better them. Think along the lines of $3-5K DACS. Many in between this range are fine units (W4S, Bryston, etc)but it takes a large $$ leap to make a major improvement. This is not a slam on the mid priced units at all, just that the technology at the lower price ranges are getting so good.