Apple TV sound quality as a transport

Rip your CDs as Apple Lossless, and turn error correction on. It'll take a little while longer, but it's worth it IMO. Not a hhuge difference, but some CDs sound a little better.

I didn't think the power cord would make a difference either, especially using the optical out. Optical out means no electricity gets transferred to the DAC, meaning less noise. Yet it sounds better. I think it could be reduced jitter at the output, but I don't know. Then again, what difference does it make, so long as it sounds better? I bought the power cable from Music Direct. It cost $79, and they have a 30 day money back guarantee. Try one out if you've got an extra $79.

Farjamed,

Are you using the original ATV or the current one? My gen 1 ATV outputs at 44.1. I know this because my previous Theta DAC wouldn't decode 48, according to Theta's tech.

The current ATV reportedly outputs everything at 48. I haven't heard it in a system outside the Apple store, so I can't realistically comment on it's sound quality.

Are you using the Apple TV's analog outs? If so, a DAC will most likely improve things. I'm not very impressed with the Apple TV's analog outputs.

Make usre everything is ripped as either Apple Lossless or similar; no mp3.

What I've found in my system -

Synched music sounds better than streamed music.
Glass optical cables are better than plastic. I bought a $25 glass Sonicwave cable from Amazon and it sounds excellent.
The Audioquest NRG-1 power cable made a very good difference.