I called and asked Wadia the same question about a year ago (i have the 170i), they told me that the iPod does all the processes (EQ, volume etc) in its digital domain before the digital signal goes through its internal DAC. The Wadia takes the iPod's digital signal out right before it enters the internal dac, that is why the digital signal is effected by EQ setting. They suggest leaving the EQ setting in OFF position
Wadia iPod Dock and iPod Settings
OK, this may sound silly, but it may be helpful to some.
I always noticed that when I docked my iPod to my Wadia 171i and played back through my D/A, it always sounded like there was way too much base, every recording. Then today I stumbled on to something, under the General Tab/Music, I had Base Boost turned on for my little Ear-Plug headphones, when I turned the EQ off gone was the irritating base.
This leads me to wonder how far back does the Wadia really go internally into the iPod as it is influenced by the EQ? This actually be a good thing to some as you have so many EQ options in the iPod, but I think it sounds best without EQ.
I always noticed that when I docked my iPod to my Wadia 171i and played back through my D/A, it always sounded like there was way too much base, every recording. Then today I stumbled on to something, under the General Tab/Music, I had Base Boost turned on for my little Ear-Plug headphones, when I turned the EQ off gone was the irritating base.
This leads me to wonder how far back does the Wadia really go internally into the iPod as it is influenced by the EQ? This actually be a good thing to some as you have so many EQ options in the iPod, but I think it sounds best without EQ.