You only need EDO if you want to play files above 24/96; it has no
effect on "sound quality".  The DAC in the Touch has held up
surprisingly well, but there's no harm in trying a newer external DAC. 
I'd look at models from Topping to start.  They range from $100-$850 US.
The D30pro looks to be a winner, but it's not in general release yet.
If possible, purchase from a store that allows returns just in case you
hear no difference or want to try a different DAC.

Some reviews of the Topping models and others are here:
https://www.audiosciencereview.com/forum/index.php?reviews/


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