OK... I'm going to dive in to where I shouldn't tread, not being fully
versed in the digital interface to the DACs, but here goes anyway...

The ethernet connection has error correction as noted before, and also
has buffering, and is asynchronous.  The data is pulled-in fast enough
to keep the buffer nearly full.  Any errors in transmission can get
fixed by the protocols which allow re-transmission (if there is
actually error correction coding, which I don't know, the errors could
theoretically be corrected without re-transmission).  The key issue,
though, is that the timing is not critical - the data is transferred in
bursts.

The digital audio interface, however, is completely synchronous.  I
suppose there could be digital errors introduced into the 1's and 0's
transmitted, but if that's the case I would say there is an issue with
the physical interface.  More important, however, would be the timing. 
These issues would be impacted by both ends of the interface... if the
clock on the transmit side (the Squeezebox) is poor, then likely the
received clock will be poor, resulting in some form of jitter which
could effect the resulting analog conversion.  I imagine some DACs go
to great pains to provide clock recovery mechanisms to minimize this
effect (some type of phase-locked loop with low phase noise clock
oscillators).  As mentioned, if the signal quality is lacking, this
will also impact this clock recovery and introduce additional clock
noise (jitter) into the the signal, which is likely passed on through
the DAC into the analog stream.


-- 
tcutting
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