I've been looking at USB DACs to play my FLAC files through my main system. Looking to make that my primary method of playback. But I've heard varying opinions on using USB as the interface between the computer and the DAC. Before I commit to a USB DAC, I'd like to know if that is the best way to go.
Touching on that first...USB sound is quite good if you get the right device. One of the main reasons I reccommend a USB DAC anymore is mostly because it's an external unit. It does all of it's decoding far far away from the noisy enviroment of your computer. Pros and Cons generally measure up to quality of the DAC to the cpu overhead required for the USB bus. The overhead isn't much anymore with the exceedingly fast processors that keep coming out. The one basic piece of hardware you'll need is a minijack (headphone/TRS) to RCA connector to connect the sound output to your stereo...and this is true for either USB or internal sound options. The USB device doesn't need to be located near the computer, so you can use a shorter cable and put it next to your stereo where as if you went with a sound card you'd have to extend the cable all the way to the PC, or locate the PC next to the stereo....both options can contribute to large amounts of PC noise in your setup.
Saying all that, if you want something simple...pick up a M-Audio Transit USB. I've owned one for just over a year and while it was the biggest impulse buy I wasn't able to talk myself out of, I wound up falling in love with it. 96khz/24-bit decoding with a top-notch codec, and the term codec has been stretched and skewed that a lot of people assume it means there's a lot of software involved; in this case, it simply means it's a enCOder/DECoder...that one chip contains both the ADC and DAC. The Transit has a couple of drawbacks...if you're wanting to record, you cannot monitor your input off the card like you can with normal cards as this thing has no DSP functions for mixing audio (it's literally just a straight ADC/DAC solution) and if you want to run the 96khz/24-bit mode, you have to turn off either the inputs or outputs as it's limited to USB 1.1. I suggested one to a guy on here for getting his vinyl in to his PC...he loves it. You could go out and buy a high-end sound card for a couple hundred bucks...but the Transit will do the same job for about $89, plus, like I said, you can have it located closer to the amplifier and keep the PC away from the rig. It also has an optical output if you're wanting to use that route.
As far as what PC you should use...that's up to you. I'd make sure whatever you use has enough oomph to actually run the OS you want to use and the ports for upgrading. Some of those slim PC's simply don't have expansion slots, leaving you with USB only connectivity...and with a laptop, USB sound is your best bet. I would however suggest you keep your PC as far away from your audio gear as possible...I don't even keep mine on the same shelf, they're across the room from each other..wireless keyboard/mouse combos are coming down in price if you decide to use a laptop.
Now, on external hard drives:
I highly recommend not using an external drive. External drives are only to be used if you're too lazy/unable to connect a second drive to a computer...and you NEVER NEVER NEVER want to keep vital data you intend to keep for a while on it. Every external drive I've ever owned has failed and every internal I've put in to an external enclosure has failed. It doesn't seem to matter what brand of drive/enclosure I use...they fail. I've even bought the WD MyBook's and had them fail just months after heavy heavy use. The cases are not designed/ventalted for long-term constant data use. The only external drive I've not had fail is my 320GB WD MyPassport...and that's after getting droped/flung from 4ft+ on more than 10 occasions.
The thing one needs to remember about all external drives, the ones you assemble or like the MyBooks...they're ALL the same basic principal...take an internal hard drive and slap it in an external enclosure. They're no more protected than they are in a PC case and in fact, more prone to damage...not many people drop or bang thier cases around..but people toss thier external drives everywhere. I cannot go with the arguement of "if you don't move it, it won't die", I had a 500gig MyBook that didn't move from the day it was hooked up till the day I just about lost every bit of my music off it. You can't trust 'em.
However, I have another suggestion if you want to store mass amounts of music. A file-server. The way I have my music stored is I have all my music in it's main archive on my 500 gig drive in a desktop computer that sits in a dry, but cool, corner of my basement hooked up to power and network (wired), right now it's running Linux, however, it previously ran FreeBSD for the same task. I simply share my /music directory as a SMB network share (windows file sharing) over the network. Unlike trying to do this in Windows (where it fails..especially if it's XP Home), the open-source Samba server for *nix provides the same functionality without the muck. Ok, so it can be a bit of a bear to configure...so I have another solution.
I'm sure you've heard (or maybe you haven't) of something called NAS...which stands for Network Attached Storage. Basically what these things consist of are hard drives in a small device running an embedded OS that you simply plug in to your network and it provides access to the data via either standard SAMBA methods or more advanced options like NSF. These devices are similar to an external....just internal drives mounted in a small box with an embedded OS. However, if you have an extra computer sitting around that you can stick a larger hard drive in to, here's a little project you should look at.
FreeNAS (freenas.org) is a minitaure FreeBSD distribution that is configured and targeted toward provided all the functions of a commercial NAS solution with very little cost, all you provide is the hardware. The main advantage of keeping your data in a *nix solution is you don't have to use NTFS (Fat32 shouldn't be used...ever..unless you demand unreliable data at fast speeds). So, set FreeNAS up and just connect to the share over the network. It's how I've been doing things for years and it wound up being soooo much more reliable than an external drive, especially for my laptop. While I do keep a copy of my music on an external drive so I can carry it around..it is not my only means of storing it, and it's not an everyday use item.
In fact, the only thing I worry about after moving to my *nix system is physical hardware failure since the filesystem is robust and *nix is impervious to viruses.
