This may be a stupid question. However any input would be appreciated (even if it just confirms that this is, in fact, a stupid question).
I Have a Fiio E17 "Alpen" portable amp, which doubles as a DAC.
As far as I know it supports s/pdif input, but I've never used it.
AFAIK the only difference between using the DAC via USB or using it with the s/pdif in is that the USB will only give you a max quality of 24bit / 96kHz, where the s/pdif should be able to give you 24bit / 192Khz. However, I think the difference between the two is inaudible, except if you're mr GoldenEars.
As far as I know, the only way to skip the internal amp in your music player is using the line-out (if it has one) and plugging that into the Fiio's aux in port or using a LOD cable.
Correct me if I'm wrong, I'm quite new to these things.