I tried a DAC64 with a Sony 999ES a few months ago and had similar problems. The DAC64 seemed to have a hard time locking to its output. It seemed like the 999ES was turning off its digital output whenever the transport was stopped and this drove the DAC64 nuts. The DAC64 worked a lot better with an old Denon DCD-1500II CD player I have that seems to maintain a constant digital output stream. I returned the DAC64 because of the incompatibility problem with the 999ES. Maybe your Krell is doing a similar thing.