Ok, I was too curious, so I just whipped up a quick test setup... (yay for breadboard :) )
On my iBasso D2+, connected via test-cable (with switchable 5V) to S3 (UM3X connected to HO of D2+):
- Charge switch on, power via USB: DAC working (noise from charging circuit audible).
- Charge switch on, no power via USB: DAC not working (add power over USB, DAC powers up and takes over from S3 onboard DAC).
- Charge switch off, power via USB: DAC working (noise from charging circuit no longer audible).
- Charge switch off, no power via USB: DAC not working (add power over USB, DAC powers up and takes over from S3 onboard DAC).
So I guess it is safe to say that (at least on the D2+), the charge switch only affects the charging circuit. The DAC doesn't run on battery power when no power is coming in through the USB connector. So unfortunately, there is no self-powered mode, only USB powered.
Of course, it might be different for the D-Zero, and if someone has one available for me to test, I'll gladly do so.
But to be honest, I see very few reasons for such an implementation of a powercircuit on pretty much any USB device, as the USB standard itself dictates the presence of 5V power.