Which DAC processes CD audio - receiver or DVD?

Thanks. After thinking about it for a minute, I realized that there's a simple way to use the Denon's DAC for music and still have Dolby 5.1 (etc.) sound for DVDs. I left the coax connection from the Denon to the HK intact and added an analog connection from the Denon the HK's CD IN. For music, I pop in a CD into the DVD player and select "CD" as the source.

As usual, this latest tech receiver doesn't have phono inputs (and I didn't have a phono preamp) but I got around that by connecting my turntable to my leftover Adcom GFP-565, which I then connected to the HK's TAPE IN. It's not as elegant as a dedicated phono preamp, but it was available and has a great phono section. The thing I'm not sure about is where the Adcom's volume should be set for optimum output. It's about ten o'clock now, where I leave it while using the receiver's remote volume control.

Soundsgreat -- Thanks! It works perfectly.

Hammy -- With both digital and analog connections made, I can A/B test the Denon and HK DACS by pushing a button on the remote. To me, the Denon DAC sounds a little better, but it's probably a jump ball.