Learned about DACs, need help to take next steps

Having been out of the Mid-Level Audio Hobby for many years, just recently I learned about AudioGon in a conversation I had with folks in a High-End audio store (new/used) in the Seattle area.

I started a conversation with series of simple questions, "Is there such thing as a mid-level two channel receiver (or preamp/amp) that had digital inputs? Is the only way to get digital-in to go with a Home Theatre type system? What if I just wanted to have a system to listen to music, without the visual image -- seems like a waste to buy a multi channel system for just two channels."

The salesman then explained about external digital to analog converters (DACs). I actually never knew that these existed outside of the very high-end. He also said that, these days, the best source of new/used audio equipment (having seen many mid to high end audio shops go out of business in the last few years) was called Audiogon and was an internet service. Finally, He also hypothesized about the possibility of most popular music transitioning to being produced in multi-channel versions (sans video) in the next few years (3-5).

Anyhow, a fews days since that conversation, I've looked through the various postings on this service (both forum messages and classified ads) and here is what I'm thinking about and thus are looking/asking you folks for some helpful advice on.

First, I'm thinking about getting back into mid-level audio equipment. I already own some decent equipment that I've had for a number of years, that I'd like to freshen up and bring into the new millenium (dare I say, digital age), without loosing the warmth and realism of analog, which I've always cherished. I've largely steered clear of "digital equipment" because it seemed cheezy and cold (in terms of both product quality (cheap overseas manufacturing) and sound quality (compromised/artificial).

To give a better picture of my current situation, here are two separate systems I currently own:

System 1:
NAD 7155 Receiver
NAD 2150 Amp
OHM L Speakers
Nothing Special Sony CD Changer (2-5 years old)

System 2:
NAD 7220PE Receiver
KEF Chorale Speakers
Nothing Special Sony CD Changer (2-5 years old)

Second, Here's what I am looking to do: Take a 500 CD Music Collection and put it onto a media server, then stream it to each system. I'm very proficient in the computer world -- more or less an expert in Linux and Windows systems. I've looked at a number of digital media controllers and feel, based on media formats supported, general compatibility, open source and reviews on this forum, that the Slim Designs Squeezebox is probably my best bet (Roku Soundbridge was a close second).

I could simply plug the Digital Media Player right into the receiver/amp, right? But that would probably be cutting quite a few corners in terms of quality analog reproduction?

So, Third, I'm thinking about procuring a mid-level external Dac, and making that the middleman between the Digital Media Controller and the Amplifier.

Thus I've looked around AudioGon and feel it would probably be appropriate for me to splurge up to $500-600 for a DAC device to "freshen" my system. Here's what I think might be good bets:

1. Scott Nixon Tube Dac + with 3XAC supply: This sounded very attractive -- digital to the warmth of tube analog. I especially liked the set a gentleman has for sale right now with metal cases and cool blue glow look.

2. Channel Island Audio VDA/1 with VAC-1 Supply: This was a non-tube Dac in a similar price range. This one also has two different inputs -- an optical and a coaxial (however, I'm sensing that most folks on this board prefer coaxial inputs)

Fourth, I'll probably want to pick up what folks are calling a "transport" -- which I believe is an updated CD or CD/DVD Player. I think I'd probably want one that can handle SACD's and even HDCD's (if they exist?). Price range $200-300. Any guidance/suggestions of what to look towards?

I realize this is a "loaded" posting, however, I appreciate any advice/help I can get, and the contribution to a conversation that may be helpful to others like me. I realize that there are many different levels of audio equipment enthusiast/appreciation. I think I've given a basic representation/perspective of what my price and quality expectations are. However, nonetheless, I am interested in getting re-immersed in this "hobby/lifestyle."
You can get a lot of guidance about digital receivers, amps and DAC's at:

and PC audio at:

My goodness! I just discovered this very ernest and straightforward post and am disappointed to find that only one person has responded in the year (almost) since you first sought advice here on A'gon. I'm curious as to what you have done to achieve your objective of simple digital tunes. I am particularly interested in your Squeezebox experience, if you did indeed go that direction. I hope all has gone well in your pursuit.