840C as a DAC. What do I need

Here's one option: HRT recently released the istreamer, which is a small DAC that accesses the ipod's internal digital files and bypasses the ipod's own DAC. The istreamer coverts the files to 16-bit at 32, 44.1 or 48kHz:

http://www.audioadvisor.com/prodinfo.asp?number=HRTIST

I have HRT's Music Streamer II+, and use it with my laptop's itunes running into my dining room integrated amp. The result sounds very good, especially for the kind of casual listening we use this system for (while cooking, eating etc).

Hi Grimace, I just read your follow up post. Indeed it is easier to get good sound out of your computer than an ipod, that's what I do with the HRT Music Streamer II+ and my laptop. Does the 840C accept USB inputs? If not, you will need a USB To SPDIF Converter (assuming that your computer doesn't have a SPDIF output), such as Musical Fidelity's V-Link:

http://www.audioadvisor.com/prodinfo.asp?number=MFVLINK

I just did a Google search on the Pure i-20 mentioned above, and it looks like it might be just the ticket. I'll likely be getting one myself. It has an internal DAC of its own that outputs in 24-bit 192 KHz, as well as digial outputs that bypass it's own DAC so you can run it into your 840C. HiFi Choice gave it a great 5 Star review and What HiFi rated it 4 stars with highly favourable review as well. Here's a link to the manufacturer's site and a discussion thread:

http://store.pure.com/store/pure/en_US/pd/productID.221628800

http://www.head-fi.org/forum/thread/529956/pure-i-20-ipod-iphone-dock-as-a-dac