System upgrade, need advice, source or speakers?

I too would say speakers. There are a number of impressions here about the MkII to the MkIII upgrade on those Zus. They might help that decision.

And I would also look at what other speakers are around at the price point you are thinking about. I'd audition things if you can to see what you can get for your speaker dollar. You may come back to the decision to upgrade the Zus, or you may find something you like better. Many excellent flavors of speakers out there.

If you only need USB for your DAC, you could also trade down to a USB only DAC or a cheaper DAC to free up more funds for speakers. DSPeaker Dual Core would be one cheaper option that also gets you DSP room correction abilities (some sellers have audition options so you could see for yourself).

You don't say what you feel the shortcomings of your system are. What would you like to improve with this upgrade?

Shakey

The DSPeaker Dual Core looks really interesting. The Zu Def MKIIs have 4 subs on the back of them and on each speaker you can adjust Volume, Low-pass Filter, PEQ Gain, PEQ Frequency, Phase. I'm wondering if I can achieve the same effect with these controls without the DSPeaker.

Yes I am looking for USB only but I've found pretty big differences between different USB solutions even in the ~$2000 price range. Most recently I've compared the Calyx 24/192 to the PS Audio DAC. Both are great units but the sound from the PS Audio DAC was far more smooth, transparent and less digital sounding. The problem is there are so many different USB DACs these days with a wide price range, it's hard to narrow down what makes sense.

Ultimately I think I want to improve the transparency and digital sound of my system. It's not bad by any means but I know it can be better. When I listen to live recordings I want get as close to the cliche of making the speakers disappear.

Sorry the MKIIIs have all those controls not the IIs.

I would suggest you add a turntable as a source.

Shakey