Looking for DAC to improve sound quality from iPod

I am using and adcom amp GFA 5400 and adcom preamp GTP 450 speakers Paradigm studio 60. iPod is connected with apple doc with analog out. I am also using adcom CD player GCD-600. Had adcom gear for long time all is in good working condition.I get Pandora Internet music from my DVD player. Would like to get DAC to hook up all three components. I have been looking at different DAC on line not sure how the iPod connects to them without using some kind of dedicated docking system like the Cambridge iD 100 or Arcam rSeries drDock or Peachtree iDac. I am new to all this and trying to upgrade without changing what I have. I feel a decent DAC would help.
If I recall correctly, Wadia makes a nice little ipod dock that extracts the digital signal from the ipod.

As far as a DAC goes, your problem is going to be finding a DAC with that much flexibility. The first that comes to my mind is the Emotiva XDA-2, on sale right now for under $350. I've been running an XDA-1 for a while now and it's a good little DAC.

I don't know how much of improvement it is that you can expect for the DAC though. It depends on the stream that you're sending it.
Are you using lossless files on your ipod? Compressed/mp3 can only get so good with any DAC.
The pure i20 doc has a dac built into it that is much better than the one in your ipod. It also allows for you to use the digital output of your ipod for an external dac. This little gem costs about $100.00 and I can't here a difference from it and my Wadia doc which costs a lot more. As Elevick stated you must copy your music to your ipod in one the lossless files to get good sound.
Thanks I will look into that
The HRT iStreamer is another inexpensive option that sounds quite good for the price.
I know that you can not download in lossless from iTunes. Can you tell me of some sites to purchase music lossless. Or is there a way to convert my iTunes downloads
You cannot convert from a lossy format to a lossless format. There are two ways to get lossless. The first is to rip your own cds into a lossless format. The second is to purchase and download them from an online service, like HDTracks.com
I second the Pure i20 dock. Best value in audio IMO. I don't sell them, but I have one.

Steve N.
Empirical Audio
I would also recommend the Pure i20 which I own. It is truly an amazing piece of gear for the money...
The iStreamer its a great improvement for iPod music. Customer support from the company is top class.