Im second the Dacmagic, even though it has USB and more than 1 input. Can't go wrong with this unit. I have never heard one, but the Bel Canto Dac 2 fits your needs and seems to be a bargain.
I have used a Bel Canto DAC2 in a similar setup it has both optical and coax inputs (switchable) and has a very smooth sound. They are frequently on A'gon
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