Hmm, I still own an iDo and have had some other nuforce units in the past. I haven't experienced anything like that. Sounds more like an actual fault somewhere in the setup, maybe a defective unit. I also listen at modest levels, perhaps it clips badly under a substantial load and I've never pushed it there. I've used it primarily with AKG K series headphones with acceptable but not mind blowing results while working. (An amusing aside, I used to have an actual setup with a DAC and Stax system but it was too engaging for a work setup so I moved it into the bedroom)
Actually the iDo sounds cleaner within reason. If both are set to the lower levels that the iDo can manage with its lower output, then the HDP of course has no audible (bad-sounding) distortion, but there's still a slight bump in the upper bass. My initial theory was the power supply, but it seems like no one else reported that problem much less on the same headphones, and with the HDP thread veering towards a debate on the merits of blowing $400 on the upgraded power supply and why it shipped with what looks like a netbook PSU to begin with. At some point I got to try another HDP albeit at a louder venue, but it had the same problem as the first one I tried, so at that point I just assumed the response really was not flat and the amp can't keep up with the EQ'd sound. It really sounded a lot like when I was between amps, and still cut my Focal midbass speakers at 40hz (basically using the processor as a subsonic filter) while using just the receiver's built-in amplifier.
Also I can be certain it wasn't the headphones because 1) I used it at home and the distortion wasn't there with a PB-1, and 2) neither was it with the M1 HPA I tried a few days prior to the first HDP.