Where does the DAC go?

If the ROKU have digital out right after. My I ask why you want a DAC?

I am under the impression that a DAC would essentially result in better sound.

But then I saw in the ROKU specs that there is an internal DAC...so that validates Kr4s response, i.e., I don't need/can't use an external DAC...correct?

If there is a digital output, the chances are that you might be able to improve upon the ROKU's internal DAC (not a far stretch to do as much, but just an educated guess on my part - I have no direct experience with ROKU to back up my assumption, but I think it's a fairly obvious conclusion). To use an external DAC you would run a wire from the ROKU's digital output, which would be one of several different types of interface (Most likely TOSLINK, RCA, or BNC - all of which are S/PDIF connections, the former is optical and the later two are coaxial). Yes, you would probably get better sound assuming you get a decent DAC.

Not that it really matters (OK, well it does), what would a "decent" DAC run me?

<$800.00 Check current threads on DACs.