This won't be important to everyone but another advantage of an external DAC is that most have multiple inputs, giving you the ability to add its benefits to other sources, like a hard-drive based music server or satellite radio feed.
To dac or not to dac
Currently i am using a marantz dv 7600 universal player for my two channel needs, I really like its ability to play all formats such as sacd and dvd audio. Although, since its a dvd player I would like a stand alone cd player, I thought about moving up to the 8001 for cd playback only but that would require selling the 7600 and thereby losing the format flexibility, although I could still play sacds. I than thought about using a beresford dac which go for under 200 bucks. My dealer using one at home and he says it makes his universal player sound like a 2000 dollar stand alone player, he suggested getting it. This was very influential for me because he does not sell the beresford, therefore he would get no commission and he is no way related to the company. He must really think its a great piece. What would you do?