I would not use the volume control on the squeezbox as it is a digital contol and truncates the bits. Better to use the volume control on the amplifier. By the way your upgrade path sounds alot like my old system.
Thanks for the comments. Like you, I have been spending a lot a lot of time lately ripping my CDs to .wav. I am using Exact Audio Copy.
Thanks for the suggestion regarding the external DAC kit. For now I am using the analog outputs on the Squeezebox. If I succeed in convincing my wife that we really do need 4-way speakers and a fancy amplifier then I'll probably try for the DAC as well. We'll see...
System edited: System edited: The Squeezebox arrived last week -- how did I ever live without this device? Very convenient. My amp is now hidden in the cabinet and I've put an orchid in its place.
Very clean looking system and incredible view! I'm sure that you will love your Squeezebox! Are you planning on using the analog outs or going through a separate dac?? For the last year and a half I've been ripping my cds as wav files through i-tunes and using the digital out with a Peter Daniel dac kit from diyaudio.com. I don't know how savvy you are with a soldering iron, but this kit at around $300 sounds really incredible and was easy to build. It is a filterless non-oversampling dac with a very open sound.