Step 1 :
Taking the typical Olson-595, I created a unit with 256 channels. The first 128 channels are digital (on/off). The last 128 channels are grouped together so that the output of 8 channels feeds a digital to analog converter (R2R resistor ladder). This gives a 0-5vdc output in 256 steps. An op amp then amplifies the signal giving 0-10vdc (the standard input for a commercial dimmer). Complete details (including schematic and more pictures) can be found at http://www.dv-fansler.com/Computer%20Lights/computer_lights.htm.
David V. Fansler