Dac suggestions to pair with Squeezebox Touch

If you stretch your budget a bit ($349), then the Schiit Bifrost is a great alternative. AKM D/A chip, JFET class A analog output stage. Great build quality.
Just got mine today and it is a great little DAC. Burning it in, as I type this...

Been running my new Bifrost for close to 24 hours now. Sound quality is definitely superior to the DAC inside the Touch. Much more detail, and great imaging. Very smooth also, with no graininess that I could detect. Bass is a little on the light side, but this could improve with further burn-in. In all, very satisfied with this purchase.

I think the leanness was subjective because I happen to have switched from the Pioneer SP-BS41-LR that I have been using for a couple months to a pair of vintage 15 ohm Rogers LS3/5A's. And the Pioneer's bass response is a tad exaggerated compared to the more refined Rogers.

I made the switch shortly after hooking up the Bifrost so I had the wrong impression the Bifrost was responsible for the bass response change.

I have continued listening to the Bifrost and the bass is definitely there. No shortage in that department.

So, order with confidence. Nice DAC and huge bang for the buck!

Vhiner, I haven't heard the DACMagic, but I can confidently say the Bifrost is superior to the Lite DAC60 with tube output stage and an older EAD DSP-7000 Series III, both retailing for more than $349.