Can I connect directly to a receiver's DAC ?

If your computer has a digital out as most do, it will work fine. You should also be able to use surround sound but may have to go into your computer's sound setting an implement it.

In answer to your second question; "... how are the DAC's usually, in upscale receivers from Yamaha or Denon compare to stand alone DACs..." - Based on my experience, these internal DACs are only comparable to the sub $400 stand alone DACs, and even then, there are some fairly amazing "entry level" stand alone DAC that sonically crush the "internal" DACs from inside a receiver. As for more expensive stand alone DACs (above the $1000 price point all the way to the moon) many can be in another sonic league entirely. As you "climb the digital ladder" many will have a much larger soundstage, a much better front to back depth (which is the absolute "bane" of most cheap digital IMHO), a much more realistic high frequency portrayal (less grain, much better high frequency overtones) and offer a better ease of the overall sonic presentation - much closer to analog.

Thanks for the posts ...

Very informative and helpful.

IMO, it's not easy to compare outboard DAC to internal DAC inside the receiver.

Internal DAC has the benefit of having direct connection to preamp/amp stage without going through additional connector/cables. A secondary benefit with today's surround receiver is build in room correction and sub woofer cross over support in the digital domain.

External DAC is usually used in much higher quality separates system that already had better preamp/amp stage.

Connect an external DAC into the receiver will be a good comparison, but that is rarely done since most people who purchse surround receiver will not buy an external DAC. And the analog input stage of a receiver is not likely to on par with separates.

Basically I would suggest that you need to spend tons of money to get some sonic beneft from external DAC and it usually involve getting something more than a typical surround receiver.