Which of my components has the better built in DAC?

My bet would be on the DA2module in your C2700.  But I would suggest that you listen to both and decide for yourself which you like best. As far as interconnects that’s subjective as well.  When I was using the DA1 in my MA8900 I used the usb connection so I can’t tell you which of the two options you mentioned is better.  Again you should try both and see which one you like.

The one that sounds better to YOU.

• USB:

  Offers the best potential for high-resolution audio transmission and is often considered the most versatile option. 

• Coaxial:

  A good choice for reliable digital signal transfer, especially if your DAC has a high-quality coaxial input. 

• Optical (Toslink):

  May be suitable for basic setups but may not support the highest sample rates compared to other options. 

There is no 'the best' DAC. There different chips and different output filters. Thus they all sound different. Pick the one you like. ESS chips tend to be brighter, AKM softer sounding, R2R - depends on manufacturer. Use USB.

My Dad has a MA8950 with the DA2 DAC and it really is a great sounding DAC module.   I think you would have to spend $$$ to better it.  It's that good.  

Coax is usually better than Tos because the quality of optical depends on the Tos jacks on the source and the DAC .    

If you read some threads on the DA2 card you'll see that people have spent a good amount on a DAC to find that it's splitting hairs.   

Plug the Node in via a good Coax and you're off to a good start.  Enjoy

Too many believe misguidedly that the only governing secret to a good DAC lies only in choosing a flavour-of-the-month “high-end” converter chip.(…. the worst approach are those floated in the YouTube reviews …especially those touting that this approach somehow elevates cheap build models to “high-end” performance strata ….HINT: they don’t ….)

Think more important, in that the essence of high-end audio musicality also resides in the line signal processing stages, the power supplies (transformers, filtering, regulation), the digital signal processing before conversion, the quality of the key components: clocks, transistors, capacitors, etc.

TAKEAWAY:

Without prejudice to intuitively first using your ears to get a first hint in an A-B direct bakeoff, go pop the hood and check out the DAC design, it’s boards layout, separate linear power supplies, segregation and proper shielding isolation for input and outputs, and the components build quality, for some further clues.
You invariably get what you pay for.

Neither are not that good, but the Mac would be better. 
rofl on the post usb being the best option. This is the worst option, and you didn’t even mention what the 2 best are.

+1 ... nice synopsis @akg_ca 

C2700

I am willing to bet that McIntosh does a better job of implementing whatever DAC chip is used.  It isn’t just the chip, it’s power supply, the isolation, the quality of the associated parts, etc.

  My Oppo 105 and first generation Mytek Manhatten DAC had the same chip and the Mytek was far and away the better DAC.  The Mytek cost 8 times more than the Oppo, and the Oppo also had video and networking responsibilities.  It was and is a hell of a machine, by the Manhatten was optimized to do just one thing, had a lot more boom boom in the power supply and everything else.  To me it was a fantastic demonstration that the chip alone doth not a DAC make.

  Without checking I am guessing that the Mac costs more than the Bluesound and I am cert has more of everything needed to optimize chip performance 

I am guessing the Mac has a better DAC, but it does come down to listening. As for the connection, ignore optical, it is down to USB or Coax. Using coax, all of the clocking ( and jitter) will come from the source, I.e. the Node. With USB only the data will be transferred and the clocking will be handled by the DAC. If we give the overall nod to the Mac, go with USB. And cables do matter, watch the used market and get something decent, lots of recommendations can be found on this site.

You have the gear, run the experiment. The NODE DAC isn't broken, but it can easily be bested by a standalone DAC. Easily doesn't mean veils lifting and wives noticing.. Improvements will likely be nuanced and subtle, but crucial, in my opinion.

With my standalone R2R, USB from the Node gives the cleanest and smoothest sound. Again, you will have to try. Implementation often dictates topological advantages*. (See: XLR vs RCA)

You have few ways to connect there -

1. RCA out from Node into Mc

2. Coax out from Node to Mc

3. USB out from Node to Mc

4. Toslink out from Node to Mc

Try it all. My suspicion is the Node into C2700 via USB will sound the best with second best option being coax into C2700. I don’t think the DAC in the Node with node’s analog outputs into mcintosh will match the digital connection.
But it’s worth exploring it all. You never know what will sound best to you. 

Your Mac's DAC should sound better to you.  I would try both coax and USB for the connection.  The biggest difference will be using the USB connection clocking will be done by the Mac which may sound better.

The one that sounds best to you was my first thought, but the all in one Node really shouldn’t be able to compete with the Mac. I have a N130 and it’s really good really works well, but I did upgrade the PSU and I ran it into an external DAC fairly quickly. After I purchased it.