I'll go ahead and state upfront that I know almost nothing about the DAC market. I know what they are used for and how they work, but I know nothing about what makes for good and bad ones. This is where I need everybody's help. Could you guys give me some solid recommendations with the following guidelines?
1) Between $125-$225 USD before taxes and shipping.
2) Primary use is for gaming and lossless audio with a pair of expensive Sennheiser headphones. This means quality is actually a factor and the DAC should be specialized for headphones (if this is actually a thing).
3) USB input (I do not have an external sound card to act as a "router" or "signal transport"). I've been told that USB will likely give worse quality than..whatever the alternative is - is this true? What are my alternatives?
4) 3.5mm output jack (which I believe is standard).
5) Can't be a USB "stick".
Some tips on how to best use the DAC would be appreciated as well (for example things not to do, how to get the best quality out of it, etc...).