Buying expensive used CD player/transp = bad idea?

is a DAC much better in terms of D to A conversion than a good pre-amp/ integrated amp?

A separate DAC (with no DSP processing) may be better at dealing with incoming jitter and internal generated jitter than a DSP pre or integrated - there is a lot less going on. However, "in theory" there is absolutely no reason a good preamp/integrated cannot sound as good. I suspect that a separate DAC may be the most cost effective option as the lower priced DAC's sell in large volumes, which reduces the machining costs on the most expensive pieces - fascia etc. Often the raw ingredients (chips/components) will be similar - as practically nobody makes their own chips/components for their own specific player...

A preamp/integrated amp generally does not perform D/A conversion.

is a DAC much better in terms of D to A conversion than a good pre-amp/ integrated amp?

According to the experience I have made with the Zanden combo, the dcs chain and Steve Nugent's USB DAC, I completely agree with Shadorne. I would follow his advice, if I were you and put PC audio into the equation even if it at first complicates things for you. According to my ears it is well worth the trouble. You could, for example, start with a good DAC and get a TRENDS USB SPIF converter for little money and experiment. There is a good chance, that you might be so pleased, that you won't need a transport at all.

Since you are getting the DAC, try it with a mid range dvd player or similar first. Don't buy a big chunky older unit unless you can hear the difference. A 5 year old unit through your DAC may sound no better than a small newer unit through the same DAC.

On another note, I have a Partsconnexion modded Music Hall that will crush anything under $2000. Consider buying a modded unit from them or underwood and skip the DAC?

If it is a very expensive piece of gear, I would consult with the manufacturer about availability of parts or whole assemblies. Most long term manufacturers will have an inventory, but even that may not last. If you are really committed to a particular model, you might even buy spare transport/laser parts.

I personally think that digital is fairly mature technology and some older models are quite competitive. A lot of older DAC chips are better than what is currently available. Manufacturers have to stop using these chips when they are no longer made unless they have purchased a huge inventory or are making a small number of elite products. For example, Zanden and Naim use legacy chips for this very reason -- better sound.

Almost all manufacturers have to go with whatever chips and transports that are currently on the market. The priority for the chip manufacturers is NOT high end audio. Each "improvement" in a chip, warranting a new model, is usually emphasizing smaller size and lower power consumption (for use in mobile devices).

Unlike speakers and amplifiers ...CD audio players have made a fair bit of progress. Anything since the late 90's will tend to be better than vintage gear (in general). I would not recommend buying anything too old for a big price tag unless you just like the idea of owning a piece of nostalgia. In another sense, CD is about to die and PC audio with DAC's is probably the future so why buy something that is likely to be even less desirable in five years.

If you can't confirm the life history of an older expensive player dont do it.If you can do it,there fine on all levels compared to all others regardless of age,YMMV,Bob