LesPaul70 said:
All modern multi-FX units do AD/DA conversion (yes, some stompboxes do, too). It will usually result in tone loss. Some people are more sensitive to this than others, and some units are worse than the others. It is definitely noticeable on most units - maybe not so much on the considerably higher-end units like Fractal Axe-FX. But whether you're willing to invest that much in a digital FX unit is another matter.
[edit]
If you are a tone snob, you will probably want carefully handpicked stompboxes that don't offend your ear.
If you are not too picky, you will probably be perfectly happy with a multi-FX unit. You might not even notice a difference. Your audience probably won't anyway.
I'd just like to add that while it's really easy to be a tone snob while you're sitting at home and listening to your guitar amp under a microscope, pretty much all the finely tuned nuances of your tone disappear the second the drummer hits his snare.
It's been my experience that the logistics of setting up and performing are more important than purity of tone, and that the use of multi-effects and midi controllers greatly aid in making a guitarists life easier while on stage.
That said, some dudes are great at controlling 20+ pedals without missing a beat. Myself, I'd rather focus on playing my guitar and engaging the audience than trying to remember to tap two or three pedals when switching from the verse to chorus to verse several times a song.
