Thanks a lot Shreyas. Appreciate your response. Now one or two things I haven't mentioned but I should have, that I am not an experienced person when it comes to tweaking equalizer. I got my first so called music phone, SE W850i I think, back in 2005/06, and since then I had always depended on presets. So if I either buy the Cowon or the Clip, I will be depending on presets only. I am leaning towards the Cowon because it has that Mach3Bass preset and I have heard that's it's pretty good. I haven't heard about any 'bass' friendly equalizer on Clip Plus.
Btw, I am currently using Samsung Galaxy Note 2, with PowerAMP (I have tried Neutron, didn't like it much, personal preference, no offense), with a bass friendly tweak which included DSP Manager, and I more or less like the sound output. But maybe I want more clear sound and deep bass, not muddy, like I get now with the pathetic given headset of Note 2. Now as you said, there is slight difference between your Xperia Arc and Cowon IAudio 10, I wonder if the one I will purchase, be it Cowon C2 or E2 or IAUDIO 9/10 or even the Clip, will they sound that much better than my phone? If the difference is slight then I might refrain, I mean I don't see any point investing 100 bucks, if the improvement is slight.
Oh, I will be using either Sony MH1C or Shure 215, with the MP3 player, if I decide it buy. And there is no problem for me buying internationally, so not much restrictions.