I have used Node products for a few years. I started with a Node N100. I used the internal DAC. This worked good for my needs and my budget. I moved up to the Node 2. Again,I used the internal DAC for a couple years before dipping my toes in the separate DAC world. There is definitely an improvement in moving to a decent external DAC. However depending upon your needs and budget,the internal DAC in the Node products is not horrible. YMMV.
Best of luck!
Best of luck!