Why a separate DAC?

Thanks folks - this confirmed what I thought. When I was researching I wanted to build a system with a tilt towards HT, but could be somewhat HiFi too. Arcam had the lowest THD I could find, and the wattage, sensitivty(?), etc seemed pretty good. That said I feel like Bluray (DTS-MA/Dolby TrueHD) content sound amazing, but I feel like the music is not as good as it could be. Perhaps I'll give one of these a go. Stick with Arcam, despite the mild scoff above, or try something else? Mainly using for iTunes content (the humanity!).

Oh and btw, can't overstate how amazing movies sound without separate components.

It's the AVR360, lowest wattage in the bunch from Arcam, at 75watts per channel (small apt). All of the circuitry and processors are Identical across their entire AVR range, only difference I can tell is wattage. As for speaker configuration, I have two KEF R300's bi-amped, with their slim center. No rear or sub. Cables are Signal.

Running music through it, I just Airplay over Appletv, which I think is my weakest link, which is why I've been investigating a DAC with Airplay. I will try burning a CD and playing through the BR as an experiment. Kind of curious if that will affect anything. HDMI can transport more data than SPDIF as far as I know, so I shouldn't lose signal there. I'll reply back if it makes a difference.

As for the DAC part - I'm keen to have something easy to use with Airplay or Bluetooth, but prefer Airplay.

Thanks for replying back!

Bob - just saw your other post about room correction, etc. my AVR actually isn't using room correction because it's not supported in bi-amp mode. That said the input is via HDMI, so it is surely digitized going in.

Interesting question though if the DAC is actually being engaged though since room correction is not happening... I'll check with the manufacturer. Appreciate all the feedback :). Hopefully I can contribute something back!

Thanks Skyflyer - I know of the Sonos stuff, and think we have a similar situation on the content issue.