Starting a computer based system

I recently began a similar journey. I am using a Squeezebox Touch and a Western Digital "Elements" hard drive as my server (I simply do not want to leave any of my networked computers running 24/7). The hard drive is dedicated - nothing else on it but music, no goofy partitions or bloatware, and it's a powered drive.
I use FreeRip to rip CDs to FLAC (set to level 8 for optimum quality) and dump the files into the hard drive. I also download 96/24 files from HDTracks and other sources.
I run a Blue Jeans Cable (Belden 1694A) digital coax from the SBT to my Maverick Audio TubeMagic D2 DAC. I also use the SBT's optical output with a glass TOSLINK cable; sounds pretty much the same as the coax.
I use the D2 DAC's tube pre-outs to my preamp.
Voila, musical excellence.
On two of my 'puters, I have MediaMonkey in case I want to listen to any of these files (I have saved all of the music in multiple drives..."belt & suspenders" approach, you know?).
Keep us posted as you progress.

Am tire-kicking the idea as well. A product called Halide was recommended to me by my dealer. It is in your general $ range, I believe under $600.

3 simple steps:

1: install Remote in the ap store with your ipad (the blue icon with side black rectangle thing-its free!!). Sync the Ipad to itunes on your macbook through remote. Now you can control your Imac Itunes with your Ipad.

2nd get a USB dac and plug a usb cable from your macbook to usb dac.

3rd go rca out of the dac to your preamp.

voila

Colorfulpellets, Explain more about your setup. How can you use your dedicated hard drive without a computer? Don't you need a CPU, operating system and the Logitech software to communicate between the Squeezebox and the hard drive?

If you are committed to the Apple platform, go here:

http://www.empiricalaudio.com/computer-audio/, as well as the Computeraudiophile web site I recommended earlier.

In short, use Amarra in lieu of iTunes, rip to lossless AIFF codec and use a high quality USB cable or SPDIF on RCA if you Mac accomodates it. The iPad info above is spot on. The DAC Magic is a very high value DAC at the price point. It only does 16/48 on USB, though, if that matters to you.

Full disclosure: I have a DAC Magic for sale on Audiogon with the outboard Pangea PS. I am selling only due to stepping up in the DAC world - see my related post in the digital forum. No issues or complaints with the DAC Magic for what it is.