I have been able to do some more listening to the Pico Power, and I also finally got my Soshine Lithium batteries. These batteries are a little longer than the stock Duracels and are a tight fit. As others here are using them I figure they are not to long and wont do any damage. I also ordered and received my Grado micro cable adaptor for 1/8th to 1/4, depending on which headphones im using.
Source is current iPod Classic 160GB with songs uploaded to iMac at Apple Lossless rate. Very happy with the Pico Power in all areas, though im not qualified to state specifics etc (NEWB)
with AKG 240, K701 I'm using the middle gain setting.