I was in the process of selling all my digital gear and focus only on analog playback. I only had my Benchamark DAC1 left when I decided to try hooking up the DAC1 to the Apple TV. I have to say that I was impressed at the potential that the Apple TV had with my DAC1. The sound is bit on the lite side, but I knew it could be improved.
I got rid off the cheap tosslink cable I was using and connected a new Audioquest Optilink-5. I also gave the DAC1 the Stereovox Reference BAL-600 treatment. This combination is the best digital sound I've had in my system. What first tipped the scale toward enjoyable digital audio was the Audioquest Optilink-5. Once this cable was in, the sound was more solid, more crystal clear and had more depth. Adding the BAL-600 was the ice on the cake.
The fact that the Apple TV is so affordable does not mean that it doesn't compare well with the best media servers or transports. I consider it a gift. Of course, I'm not implying the this combo sounds as good as my analog rig, but it makes a decent digital recording sound quite pleasing.
