Yes, the Sonos ZP90 has a digital output and will work nicely with the DacMagic 100.
2. Will it up-sample?
The DacMagic 100 does not upsample, however, it does use the new Wolfson WM8742 24-bit DAC and will accept up to 24-bit/192kHz input from its digital inputs and USB audio input.
3. Have the bass issues been resolved? (muddy-ish sounding in the old one)
Obviously difficult for us to comment on this as the original DacMagic won hundreds of awards for its sound quality and operation. We are very happy with the sound of the both products and would recommend an audition as soon as the unit is available so that you can hear it for yourself and form your own opinion.
4. Can you post the dimensions? (a minor detail I know)
The dimensions are as follows 105mmx46mmx120mm.
There is a great deal of info on the DacMagic 100 in the link below if you've not read already?
Also, we’re happy to provide some answers here, but for technical enquiries we do ask that you contact our technical support at http://support.cambridgeaudio.com/ where you will get the quickest answer.