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I own and use on a daily basis a Squeezebox Transporter, two Squeezebox Touches and two Squeezebox Classics. One of the two Touches was an upgrade from the Squeezebox Receiver (the "player" half of the Squeezebox Duet) and boy what a big improvement in the sound. The Touch is substantially better than the Receiver/Duet, whether one is using the built in DAC (i.e. the analog outputs) or an external DAC (the digital output). i suggest that you pick up a Squeezebox Touch and give it a listen, I think that you will be very pleasantly surprised, both at the sound and just how good something that costs under $300 can sound.
Thnx for the reply and suggestion i will give it a try to see of that is a improvement.
I forgot to mention i use a exernal dac a musical fidelity V-dac
May I suggest that once you get a Touch that you run an A/B test of the Touch's analog output versus the Musical Fidelity's analog output using the Touch's digital output. Both the analog and digital outputs of the Touch can be run at the same time so doing an A/B test is very easy. Just be careful to match the volume levels as closely as possible.