Hifiharv - DVD players usually are not great as CD players because their main function is DVD playback (but have great tracking). If you combine cheap DVD player with jitter rejecting DAC like Benchmark DAC1 you'll become independent of the transport, will be able to play DVD and MP3s (inherent decoder in most DVD players) and also connect your HDTV and computer/server. Digital cable can be generic or self made. I use Benchmark with $70 Sony DVD player and sound is great.
CD's in DVD players a compromise?
A broader question than it may seem at first. Apparently, the verdict is that DVD players do not excell at CD playback. Are there any DVD players out there that have actually surprised you with their CD capabilities? Also, what is the limiting factor here? Is it the digital reading of the CD. If so, then even an outboard DAC won't improve things. Is it that the internal D to A conversion is optimized for DVD's? If so, then an outboard DAC would be the answer. Does anyone out there know the cold hard technical facts on this subject? Will things get any better (or worse) with a Blue Ray player?