What the manual means to say is that the output goes to the preamp section of an amplifier (such as an integrated amp or receiver). They weren't completely clear. The DacMagic cannot be hooked directly to a power amp as there is no volume control. So, if you have separates (separate preamp and power amp), the DacMagic must be hooked up to your preamp.
You would connect the digital output of your sources such as a CD player or Wadia 170i to the DacMagic, and then connect the balanced or unbalanced outputs of the DacMagic to your preamp, then preamp connected to power amp. If you don't have separates, then the DacMagic is just connected to one of your analogue inputs on an integrated amp or receiver.
You would connect the digital output of your sources such as a CD player or Wadia 170i to the DacMagic, and then connect the balanced or unbalanced outputs of the DacMagic to your preamp, then preamp connected to power amp. If you don't have separates, then the DacMagic is just connected to one of your analogue inputs on an integrated amp or receiver.