Is there a Headphone AMP/DAC that would connect to my IPOD and source the digital signal?
I see many that are USB to allow connection to a PC or Tablet but none so far for IPOD.
Apple does not like their products to be connected to something that has not paid Apple a royalty check.
That's why Apple uses their own digital interface (Lightning).
Better just to get a Fiio X3 or iBasso DX50, they already come with a good built in DAC and Amp.
All of my music is stored in Apple Lossless format. I do have a Pure Ipod Doc that sources the IPOD digital signal. I send that to my stand alone Quad DAC and then to my current Headphone Amp but this is obviously not portable. The Ipod is nano G5.
The FiiO X3 can play Apple Lossless files, and I would assume the iBasso DX50 can also.
Buy the Fiio X3 ($200), load up your Apple Lossless files and sell the iPod.
The FiiO X3 comes with a amplified headphone jack, a line-out (analog) port and a coaxial (digital) output port.
The Fiio X3's DAC chip (WM8740) should be better then the iPod Nano's.
Best to ask here about details like that.