Alex,
This is not an easy answer. It really depends on the fidelity/resolution of the rest of your system, your ears, room, etc. The Oppo is a great value for redbook, but does not (without a real mod like Modwright's) compete with good $1500+ DACs that are fed a good firewire or low jitter signal (such as Metric Halo ULN-2,, Weiss DAC2, etc). The Touch solution allows for far more flexibility in choosing DACs (albeit via SPDIF). However, the Oppo does two things that no Squeeze solution will do.....BluRay and SACD (let alone video, multichannel music, etc). Note: I didn't say DVD-Audio (2 channel) cuz you can do that with the Touch (up to 24/96) if you know how to rip hirez 2 channel layers off of DVD-Audio discs.
P.S. if you don't, c'mon over to our HiRez circle
http://www.audiocircle.com/index.php?topic=69151.0And no, the Oppo doesn't play FLAC. I don't think that was his question. FLAC is his format of choice for the Squeeze options, not the Oppo one. With the Oppo he's still spinning discs. Me, I'd do both (Oppo for all things SACD and BluRay/DVD, computer for all redbook and hirez PCM).