A very sad day for me. I got a response from Steve this morning about my Taboo. Below is Steve's response. I hope he doesn't mind me reposting it so any Taboo MKIII owners thinking about getting the TEAC UD501 DAC for DSD playback might consider other options.
"I wanted to update you on the status of your Taboo MK III. We did in fact build you a brand new unit and were quite surprised to find it did exactly the same thing as your original unit with respect to the super audio files on the Teac Dac.
After a long evening, I found that the Taboo MKIII does NOT in fact have ANY parasitic oscillations. This bizarre deal with the Teac DAC has fooled everyone on my staff, including myself, into thinking it must be the Taboo since the DAC works fine with other amplifiers. After tracing things out with the scope we were able to confirm that the static sound is in fact originating inside the DAC, not the TABOO.
Why being connected to the Taboo causes this apparent defect in the DAC (which is tied to the FIR filters as you can hear it change when adjusting them) is a mystery to me right now, as is the fact that it does not happen on our Sample TABOO from which we build from.
I plan to continue trying to find out over the next few days, but there is a good possibility that I will not be able to justify spending too much more time troubleshooting another manufactures defect leaving the worse case scenario that the two are simply incompatible."
I have cancelled the order awaiting whether Steve could find a solution for this. Thx all for your input/support in this problem.