Do I need a DAC?

Oscarrr, I have enjoyed this thread as I have many friends considering the same. You have garnished a great deal of input, most of which I agree.

1)Driving a DAC with the AE via SPDIF would be an improvement.
2)A computer playing WAV or AIFF quality files into a DAC would be additional improvement.
3)There are many DACs available (new or used) that would satisfy your needs.

As a further thought:

There are a number of DACs that came into the marketplace ~5-7 years ago that were and still are very good DACs. Their weak link has been the USB input if indeed one is provided. Given that the AE outputs SPDIF you can avoid the USB input on one of these older DACs. They often sell used for 30-50% of original retail. The Cambridge Dacmagic might be a place to start. Has 2 coaxial SPDIF inputs, which many do not, and this can come in handy for other sources. Should be able to get a used one for ~$250. The Musical Fidelity V-DAC could be bought used for less than $180. PS DL III for ~$350 - $400. You can keep a used DAC around for a year or two, resale it at a reasonable % of your cost, upgrading later after exploring the marketplace.

You might want to download free softwares to improve the sound - asio4all, and foobar.

A good DAC will improve the sound, but if you are happy with the sound, I would just enjoy it.

Your rest of the system is good enough for it to show the improvement had from a good DAC though.

If you can comfortably afford it, I would go for it, if I were you.

Thank you very much for all the responses! It has been a great help for me, and I have come to the decision that I will try a DAC at home. It can be returned to the store within 2 weeks, so I can see if it's worth the money.

Thank you for the summary Mesch - it made it manageable.

Did your DAC make a noticeable improvement?