AT&T Galaxy SII Digital Audio Out & DAC/ Amp suggestions

I was going to spend lots of money creating a surround system, but I decided against it until after Christmas.  Instead I want to treat myself to a DAC/ Amp for my SII as the Yamaha chip sounds really awful.  I have read threads that say the SII CAN output digital audio, and I have other threads from various places that say you CAN'T.  Just was wondering if anyone has successfully hooked an SII with a portable DAC/ Amp.  If not I may need to find an audio player with a decent chip and allows for Spotify, FLAC, Google Music and has large or removable storage.  

If it makes a difference I am rooted with the latest Jelly Bean 4.1.1 AOKP ROM and whatever Kernel comes stock with it.

Thanks Ahead!

I am thinking now of just getting an iPod Touch 5G and maybe getting a DAC/ amp for it later on.  Any ideas on how it would sound with Sennheiser HD25-II cans?

I thought I could bump my old thread instead of creating a new one.  If I don't get any replies in the next few days I will create a new one with a new title.  

I am thinking of getting a 7" tablet for Christmas and run a DAC through it.  I have thought about several:

Nexus 7

Pros:

1. Great Screen
2. Pretty Darn Fast
3. Rootable and DAC'able
4. Runs Android
5. Not Apple
6. Cheap

Cons:

1. DAC Hack is Rough (lots of inconveniences)
2. No Expandable Memory 
3. Sounds Terrible Stock

Samsung Galaxy Tab 2 7.0

Pros:

1. Fast
2. Runs Android
3. Rootable
4. Sounds Good Stock
5. Expandable Memory
6. Not Apple
7. Cheap

Cons:

1. Terrible Screen W/ Lots of Glare (Something I am not sure I could live with as my Toshiba Thrive has a really bad screen and I hate living with it)

Unknowns:

1. Running a USB DAC/ amp?

Blackberry Playbook

Pros:

1. Sounds Great Stock
2. Not Apple
3. Cheap

Cons:

1. Outdated/Unsupported
2. Slower Hardware
3. Complete Lack of Apps
4. No Expandable Memory
5. No Android

Unknowns:

1. Running a USB DAC/ amp?

Apple iPad Mini

Too many unknowns and very expensive for just 16GB considering 32GB iPod Touch is 300$.

Nook HD

Another model with way too many unknowns.

Any ideas on more tablets that would fit the bill (pros and cons)?  Anyone have any suggestions that would be better? As you can tell I am not much an Apple fan but their products do usually sound pretty darn good both paired with a DAC/ amp and without.