I only took a brief look at the manual earlier, thought I saw two 3.5mm ports but may have mistaken the 2.5mm port for one of them. It seems to share the same 3.5mm port, with internal settings, to switch the 3.5mm headphone out/line out/digital coax out options. That cable appears to provide a digital connection should you want to use an external dac. Whether you prefer the audio via the internal dac or an external one is something you'll have to determine for yourself.
Personally I just stream to my Denon from my android phone or computer via dlna/wifi, don't need a separate portable device otherwise....