I can't vouch for it personally, as I haven't had experience of it, but by taking the example of a USB Soundblaster PC Soundcard I had, which was quite a cheap one (£70) it knocked spots off the internal DAC on the laptop. Given that the soundcard had all of the other extras like remote control and leads, I'm guessing the cost of the DAC chip is pence - so there's no reason why a very adequate DAC couldn't be put together for this amount of money, and I'd wager it would improve upon the airport express's built in one...
I'm pretty sure it is the same as this one on Amazon with a different name - most people using them to take the sound from TVs, but some for audio:
" Allows me to run 10m of optical cable (mini-TOSlink to TOSlink) from my iMac into my TEAC analogue inputs. The sound is even better than running directly off the TEAC cd player ! Very happy bunny."
"Bought this to give me a clean signal from the optical output of my Macbook Pro as it's analogue output is pretty awful. Plugged it in and away we went. Lovely clean, rich sound (and I've been a professional sound designer for 22 years so I'm picky). Would recommend wholeheartedly."
"Bought this to connect to an Onkyo ND-S1 Ipod dock (also bought from Amazon). Does the job just fine. Connected the Onkyo to the DAC using a QED optical cable and then connected the DAC to my Yamaha analogue amp with Cambridge audio co-ax cables. Great sound"
Dunno - would be an interesting experiment, though but I don't have an Airport Express (or any play money left!)
Alex
Main System: Digital: HP Laptop/M2Tech Hiface/Logitech Media Server/FLAC; Marantz SA7001 KI Signature SACD Player and other digital stuff into Gatorised Beresford Caiman DAC Vinyl: Garrard 401/SME 3009 SII Improved/Sumiko HS/Nagaoka MP-30
Amplifier: Rega Brio R. Speakers: Spendor SP1. Cables: Various, mainly Mark Grant. Please see "about me" for the rest of my cr@p! Gallery
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There is only one way to avoid criticism: do nothing, say nothing and be nothing Aristotle