PC+Dac or Streamer

I have never had a problem finding my library with my Node2i but it will dropout every so often. I use it wireless only, way to much trouble to get a wire to my living room. Since I have put the Node on it’s own 5g network ( also make sure you aren't sharing  your channel with others  in your area )and given it a static ip address I have had a lot less problems with it doing that. If your bluesound device is wired you might try going into the router and doing the static ip address. To the OP I agree with the others who say find a good DAC in your price range and start there.

I have yet to have any issues with my BlueSound Node 2 either losing my library or dropping out on music, but I've only had it a couple of months. 

I have a strong wireless router and a wireless access point set up in my rack with a 4 port Ethernet hub that I have my Oppo UDP-203, AVP, BlueSound, and Roku connected to.  No issues with any of those devices streaming over wireless, even with Netflix 4K content.  I basically did the same thing in my bedroom and home office. 

WAPs are pretty inexpensive and easy to set up and Ethernet switches are cheap.

I had Sony HAP-Z1ES hard disk player for a few years until earlier this year I tried China-made R2R DAC (Terminator) but later settled with Marantz SA-10 SACD player. Intel NUC with dedicated M.2 SSD for O/S and another internal 2TB SATA SSD for music library plus 19V linear power supply were used as digital audio transport. Intel NUC connected to SA-10 with Curious USB. I also tried many different playback software, both Linux and Windows, free and paid versions (trial), but settled with HYSOLID (free) running Windows 10 Pro, manually optimized.

I agree with @n80 comment that sound quality is the best when playing CD/SACD directly. In my system, playing the ripped version from external SSD drive connected to SA-10 is equally good. But I was very surprised using Intel NUC as digital audio transport is very close behind but with the benefit of mobile app controlling albums/artists selection from listening position. The total costs of building the NUC is slightly lower than HAP-Z1ES brand new cost, but the audio quality is so much better.

The good thing about having a CD/SACD player with USB Audio input rather than DAC without playback capability is that I know what is the reference sound quality - what’s the best sound I can get when playing physical media or external drive. So I can explore which digital audio transports come close to the reference SQ. However, using DAC only (like the Terminator), I don’t even know what is the correct sound. Buying digital audio transport or streamer to pair with a DAC can be hit or miss, depending on the quality of interface (e.g. USB interface without galvanic isolation can be a problem).

My suggestion to @murgeshj if your existing CD player does not have USB Audio input, get a new CD/SACD player with USB Audio input and also with the ability to connect an external drive. You can then continue to play your existing CD collections and new digital downloads. Later on, you can try build your own digital audio transport. Dedicated streamers can be very expensive.

Note: the main reason I have to use USB is that I purchased DSD 2x and 4x albums online. I also have SACDs which were ripped.

Mahler123 - thanks for the suggestions.  As it turns out, running Ethernet to this particular location is problematic so I have been forced to use the WiFi function of the Bluesound.  However, I may try to run Ethernet through the floor to the location of the system to improve reliability - and because it would give me additional server options too as WiFi enabled servers are kind of rare. I thought about the NAD M50.2 - as that has local storage and a CD ripper which would generally solve my problem.  But I’m reticent to give Bluesound OS more business - and I don’t feel like re-ripping my entire library anyway.

FWIW: I reached out to Bluesound’s tech support for input - and they ultimately wanted to remote into my system to sleuth things out.  Frankly, while I’m not in IT, i’m not tech illiterate and needing a company to remote into things to solve these challenges tells me their software is not fully developed.  So, I restarted the process multiple times and was successful in getting things to work again.  And then, for a reason I can’t yet explain, I again can no longer access the files on my network, even though I can clearly see the address of the files in the Bluesound OS setup.  I haven’t gone back to redo it again because frankly, I don’t feel like it yet.  But, I’ve left feedback for Bluesound corporate accordingly.  

IT’s too bad because I think overall, the Bluesound Node 2 is a killer device.  For the price, it sounds great when using the coax digital out to my DAC. And, the idea of being able to reasonably easily play files on my network, or Tidal, Spotify, etc. all within the same app is very appealing.  

I think software engineers frequently forget that they work that they enjoy is maddening and/or tiresome to most.  I want to come home, turn on music and enjoy an experience I’ve spent quite a few $s to create.  Waking up my system to find that it needs an update, or worse, needs a fix to a file sharing request, or whatever, sets me on edge in a hurry.  I want it to simply work.  Like my Aurender does.  I wish Aurender had a WiFi option....  

@mgrif104 It sounds like your issue is more of a networking issue than a Bluesound issue. When I moved to a new place where I couldn't run a long ethernet cable like I did before, I switched to wifi operation and because of the distance between audio room and the router, I had intermittent trouble. 
While not as good as the suggestion to run ethernet cable thru the house, in the interim, this might solve your wifi problem, it works for me.

https://www.amazon.com/gp/product/B00Y3QYTS6/ref=oh_aui_detailpage_o08_s00?ie=UTF8&psc=1

Theoretically, I don't like the idea of making all the copper wiring part of my rig, but I feel like airborne wifi is probably worse sonically and certainly more troublesome in terms of stability of signal. Cheers,
Spencer