No, usb out is raw data, which is pre dac, same as optical and coax. His motherboard is acting as the dac and is ouputting analogue.
EDIT: oops I misread the above comment... :) sorry I realize now you were asking what he was using as a transport.
A dac may make a difference, the K701 are very receptive to any system changes. I can easily tell the difference between opamps, dac's, buffer's in my audio-gd fun. If you were willing to increase your budget and wanted a dac you should've let us know before you bought your amp. The audio-gd Fun is a nice dac with a very nice amp (lots of power and voltage swing) and would have been in your budget. Im using it right now to drive the K701's and love it. But now that you already have a nice amp finding a dac to match might be kind of tricky...
Here's the thing with getting a dac. If you get a cheap dac you may not notice much of a difference between your motherboard and the dac. If you spend just a little bit more is where you will see the biggest difference. The 300+/- dollar range is the sweet spot. After that I think is where diminishing returns start. Usually at this price range is where they have built in power supplies instead of wall warts etc and the extra budget can give audio engineers more room to play (quality parts etc). IMO not all dacs in that price range will fit the bill. It's more where I think high quality sound can be achieved with a lower budget.
Edited by muad - 7/29/10 at 6:05pm
