1. Yes, you can keep using ITunes. I use Foobar2000. Blindjim mentions some other very good programs.
2. I disagree with TAS. There is no functional or qualitative difference between using a USB out to a good jitter-rejecting DAC, or USB to Optical converter (Behringer UCA-202), or having the computer deal with audio data internally and output via optical soundcard. In every case, a good DAC should simply reject jitter as that's what it is intended to do.
If you must buy an expensive sound card, which, in most situations is redundant, in my opinion, look up a pro unit like Mark of the Unicorn (if you have a Mac), or RME Fireface, if you have a PC. Those have state-of-the-art wordclocks for to deal with jitter if that's what you're worried about.
Otherwise, just stick with a $40 UCA-202 out to your DAC or preamp. Or go the wireless solution and get a Squeezebox or Sonos. Your call.
2. I disagree with TAS. There is no functional or qualitative difference between using a USB out to a good jitter-rejecting DAC, or USB to Optical converter (Behringer UCA-202), or having the computer deal with audio data internally and output via optical soundcard. In every case, a good DAC should simply reject jitter as that's what it is intended to do.
If you must buy an expensive sound card, which, in most situations is redundant, in my opinion, look up a pro unit like Mark of the Unicorn (if you have a Mac), or RME Fireface, if you have a PC. Those have state-of-the-art wordclocks for to deal with jitter if that's what you're worried about.
Otherwise, just stick with a $40 UCA-202 out to your DAC or preamp. Or go the wireless solution and get a Squeezebox or Sonos. Your call.