nc8000
Headphoneus Supremus
The DAP is already capable of interfacing and performing digital file transfer with a PC over USB, I don't see why it needs more converter chips.
Logically speaking the S-Master wouldn't care as it would be fetching and decoding the file from some sort of local memory buffer inside the DAP, I can't see any competent engineer would make something that decodes from a straight raw digital signal.
I'm not technically competent enough to argue what is involved in transferring a music signal over usb as opposed to file transfer but I'm confident that it is a bit more complex that what you describe