change to ARC Dac 7?

Unfortunately, these are questions only you can answer. We all know about the laws of diminishing returns in this hobby. How much money you are willing to spend chasing incremental benefits is solely up to you. Sorry.

Jmcgrogan, Thanks for saying that and giving me that push. I wouldn't be using the Dac 7 for computer audio but had wondered if the presentation would be a bigger step in my rig. I had read the reviews of the Dac 7 and they were glowing which prompted me to think if that move could be a good one but....I would much prefer to make a larger step in that search as opposed to just incremental and I can save money and wait for a change that will make a large difference for me, even some of the tweaks I've made have produced huge improvements that other wise would have cost me thousands in equipment changes. Again Thank You for that reminder.

You are very welcome, we all need a little reminder now and again. Reviews tend to glow, that's their purpose, to move product. I'm not saying not to improve your system if you want, but be cautious, there are a lot of sharks in these waters that we swim in.

Yes, many times you can gain a lot more from playing with speaker toe-in or placement than you can buying a new gizmo. There's nothing wrong with buying a new gizmo if you want to, it can be fun to play with new stuff. Just mind the glossy rags, their purpose is designed to motivate buyers and move product, NOT to be used as useful information.

Suggest calling Audio Research. If anyone knew, they would. In my experience they are usually happy to help with these types of questions. I own the DAC7 but not the CD3 MKII. Looking at the specs for the CD3 MKII, that unit looks pretty substantial, and I doubt the DAC7 would be the significant upgrade you are looking for. With digital the law of diminishing returns sets in fast and I think it would take a lot of $ to better the CD3 MKII in any meaningful way.