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“if you have loss at step 1 @20%, step 2 only sees 80% maximum.”That's a big 'if'. 'If' the point is getting your money's worth from devoting a subjective percentage to individual components my vote is 70% speaker, 25% recordings and 5% to whatever is left over.
A few years back I did a DAC shootout with some audio friends. The DAC's were a $500 IFI tube DAC, Bryston BDA1, Ultra, Chord Hugo, W4S DSDse with the Femto clock upgrade and an Exogal Comet. The results were eye opening with each DAC sounding very different. The Comet and Bryston sounded the best. The IFI was mifi sounding.I have several newer DAC's in house and they all sound different. Emotiva Big Ego, Schiitt Modi 3, Luxman DA-06, Chord Qutest, AVA SL Ultra II with upgrades and a built in DAC in a $6K Cary Integrated. They all sound different and as you go up in price the sound improves dramatically with the older $5K Luxman still sounding the best and the Qutest coming in second but it has the most detail.I have heard many other expensive DAC's and even had them in my system and they all sounded different.What further complicates the matter is that I own several different USB cables and they all sound different and they sound different with different DAC's which is a real head scratcher.
The Chord Qutest really gets to another level when the M-Scaler is connected to it. I wish the M-Scaler would provide the 705KHz/768khz to all DACs, those only work with Chord DACs. I use the M-Scaler with both the Chord Hugo-TT2 and a Devialet Expert Pro 250. The M-Scaler improves any DAC I've tried with it.