Help selecting transport device to connect to two channel receiver

I installed the Roon server docker container on my unRAID server last night and I can’t remember the last time I have been this excited about listening to my favourite albums again! The transport layer information in Roon is great but it made me hang my head in shame when I realised what it was doing to my lossless files. The Apple TV4K is a rubbish transport device!

My weird setup:
I have what is technically a 2.2 channel surround sound receiver capable of decoding 7.1 - Arcam SR250. It has a multi-channel DAC (Cirrus Logic CS42528 DAC) but only outputs to two monitors and two subs. It can decode all the surround sound formats including Dolby Atmos & DTS:X and push 7.1 channels over two speakers and two subs. It also has Dirac room correction - I am yet to get around to configuring this.

My question:
While Arcam theater equipment is known for being musical I am curious which of these options is best for me:

  • Keep the stream in the digital realm as long as possible and use an SPDIF only device like the Allo DigiOne or Metrum Acoustics Baby Ambre
  • Get a DAC like the Allo BOSS bypassing the Arcam DAC
  • Get a combination of the above like the Pi 2 Design 502DAC and work out which sounds best.

The last option seems like the most logical but I would appreciate your thoughts.

The Allo Digione (not the signature) is a workhorse and sounds fantastic. thumbs up from me.

Maybe option 1 with a windows celeron nuc that has toslink out, plus a wireless keyboard/mouse combo. Then you have the full hdmi display and complete remote control on screen.

Thank you for the responses. I realised last night that I am very confused about how an external DAC works when it only has a digital output. Can you please help me understand the following:
If I have a DAC like the Allo DigiOne it will do the following:

  1. Accept and decode the audio file from the Roon Server (via Ethernet) using its DAC
  2. Send the decoded file as ?PCM? over the SPDIF connection to my receiver
  3. My receiver then decodes the audio using its DAC and then amplifies it and sends it to the speakers

If this is the case don’t I have two DACs in the chain? It must be hard to evaluate DACs when you have two in the chain like this? Additionally why does the Allo DigiOne have a DAC when it is NOT technically performing a digital to analogue conversion. SPDIF is only digital from my understanding. Therefore the DAC is performing a digital to digital conversion?