I Don't know JAC about DAC.... help please

I would like to get my first DAC but have lots of questions. Is it only for CD, SACD etc or does it also work with DVD's? What is the difference between a CD Player and CD transport? Where is the price point of diminishing returns, meaning I don't need a $10,000 DAC for my $800 CD player. Any recommendatiosn to get into a DAC sub $1000.....

Thanks