Just happen to notice whilst reading Gordon's post on the PAS2 that you're from J town. I work in Neosho but live out by Stark City. I see that you know Steve too. Us tube heads gotta stick together!
Danny/guitbanger
I wouldn't say that, necessarily. Your hearing may be more tuned to the differences than mine. Check out the DAC that I have for sale in BT. It is dirt cheap and upconverts to 24/96, plus has a nice headphone section. I'm not pushing it, or even suggesting that you buy it, but if you are considerting buying one, this will give you a taste for cheap and will be easy to flip.
I switch out gear like nobody's business and rarely have time to listen critically anymore but I don't have any real issues with the internal DAC of the Squeezebox. I have used a PS Audio DAC, Musical Fidelity DAC, Muse DAC, Citypulse DAC and the DAC from a couple of pre-pro's from Myryad and Sunfire. All were a bit different but not substantially better than the DAC of the Squeezebox. That being said, I'm sure that I'll try another DAC in the future but I'm DACless at the moment.