Pimoroni has a line of £20 hats that help solve that: https://shop.pimoroni.com/collections/pirate-audio

I bought a couple, they're really good, my only dislike is that the screen software is written as a Mopidy plugin, but I'd prefer a remote mopidy instance and the pis and hats are just clients with controls.

Did you find a solution to the remote mopidy instance yet? I'd like to do the same thing.

I assume this is only for the analog output, right?

Obviously if you're just using a cheap or old amp it won't have HDMI, but if you're amping with an A/V receiver you can just use the HDMI out and get perfectly good quality.

Pi native audio has gotten a bit better. https://www.raspberrypi.org/forums/viewtopic.php?t=195178

I ended up using a (cheap) USB DAC to get around the RPi’s onboard audio. It’s a bit cheaper than a HAT, but can be hit or miss for compatibility.

For snapclient, I used a USB DAC at first, but turning it off and then on meant that snapclient lost its connection. I could not resolve that so I purchased a DAC HAT instead.

It was really bad when launched, but to call it really bad now (or in 2018) is not fair. A lot of poeple waste their money on these hats when they don't need to.

Has the hardware improved or just software? I have a DAC-Hat and it definitely picks up some sort of digital noise from the pi. I can literally hear SSH when large amounts of text are being dumped across the wire.

The Pi 1 B+ was improved with a dedicated power supply and I think that might have been it on the hardware side. The big improvement came with the software, details of which are linked elsewhere in this thread.