The problems not enough gain to drive you amp to full output. The majority of DAC's don't have a volume control or input for others components. Preamp should be able to drive long cables not a DAC. All DAC have an analog output and it a matter of changing resistors in there feedback loop to increase the gain. I have done this before, however the sound difference was still improve with an extra gain stage/ preamp.
DAC as pre amp
This post is just a brief for posterity sake in regards to the the significance of a good pre. As I have stated in other threads over the last few years , when the subject arise, I occasionally remove my pre from the chain and run my Wadia 321 as the pre. I always find my way back to my dedicated pre. I got some Quad Z-4s awhile back and after a recent post regarding the DAC direct question I decided to try again. This round the improvement was even more dramatic with the dedicated pre and the Quads. My modest system is good enough for my level of listening sophistication. but If I ever decided to upgrade a component in the future , the pre would be the unit I would explore. Another member stated that a good pre will ad a "richness" to the sound. I think that is exactly what I hear.