Try it both ways and listen. See which sounds the best. That is the best way to know.
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How do you ever get the volume of the sub matched to the volume of the main speakers? Everytime you change the volume on the LFD, it seems you have to change the volume on the sub to stay in sync with the main speakers.
The sub should be connected on the output side, either line level or speaker level, of the LFD. Set the DAC1 to be fixed gain -- volume control will be done by the LFD. Use any connection you like between the DAC1 and the LFD. Set the sub's level to match that of the main speakers once and you won't have to touch it again.