mp3 bit stream to DAC?


I have an mp3 player (archos av340) which in addition to the headphone analogue audio out, has an SPDIF out. I used to plug the SPDIF out to my yamaha tuner/reciever/amp SPDIF in and play through my stereo system. The SPDIF out/in gave much better sound than the archos analogue out/ yamaha analogue right/left in's I used before I learned I could go the "digital" route (I guess the yamaha had a better DAC than the archos?).

The question - I bought new speakers (quad 989's), a tube amp and an ACK DAC 2.0 to be able to again play my mp3's the digital route through my new system. I get NO sound or indicator light "on" on the ACK indicating the ACK is getting a digital signal fed to it. Should the ACK (or any other DAC for that matter) be able to get and DAC mp3 bit streams (like my yamaha reciever did)? If so, any thoughts on what I could be doing wrong.

Finally, I know mp3's through a "nice" system is an oxymoron (i.e. the mp3 signal is compressed compared to a raw CD signal), but, most of my music is mp3's so I still want to make things work.

????
hovendic
Peak, it is labeled input, but the manual says it is both in and out, and it has worked out to my yamaha digital in. That is the only reason I have kept it so long (the newer versions do not have it, I believe some worry about digital rights).
Just wanted to close the loop on this, I bought another DAC and it does work on the mp3 bit stream from the spdif out of my mp3 player.
Hovendic,

I looked around for an answer to your question, but I could not find anything specific as to what requirements a DAC needs to play an MP3. MP3 players have decoders built in them, but outboard decoders or DACs seem to be lacking. Perhaps MP3 decoding is built into more modern DAC chip sets? Your Yamaha must have this capability. If a component says, "It can play MP3" that is a bit ambigious as this can mean before or after it has been decoded to analog.

What DAC did you buy? Was there any improvement?