Best way to hook-up a cd player to Krell 400xI

Personally I would say get rid of the marantz even if you were thinking using it as a transport and get a nice cdp. Or get a good transport and dac.

Balanced outputs do have some advantages (noise rejection and HIGHER output [real useful on long ic cable runs]) but is not as important as a good unit.

An in home demo is a must because depending on the room size - speakers - position of speakers and listening position can make a difference of the way it sounds. Most important will be how it sounds to YOU.
My $0.02 worth

Definately - using the 400xi with a Marantz changer is like putting some old, 14 inch wheels on your new BMW 535i.

Thanks, but I was curious to know if people use DAC's with their krell/cd set-up. Or would I get a noticeable improvement purchasing a Cd player w/ balanced outputs?

Matt

The amp does not have an optical cable or Coax output?

You mean input.
Connect your player to the Krell using either Xlr or Rca cables. Optical or coax inputs/outputs are generally used between Transports and Dac's