The advantage I see with the Squeeze Box is in providing remote display/control. If you're not in the same room as the computer, or you're lazy and don't want to get out of your chair even if the computer is "convenient". The Squeeze Box can be modded for better sound, use it as part of the transport only by adding a better DAC to it , or both. Besides the Squeeze Box has a digital realm volume control (plus access to internet audio streaming) so unless you have vinyl, FM, SACD, or other sources it makes a pre-amp optional.
Yes, by all means move the D/A processor out of the computer.