I'll let someone knowledgeable answer the technicalities, but I happen to be a fan of crossfeed(not speaker like, but still better than basic headphone panning for my taste).
if you're at ease with vst and tweaking values yourself, then I would suggest to stay with software. the customizable aspect of it is a nice advantage you will not find on hardware crossfeed.
also it's hard to answer your question as there are several software ways to get crossfeed from very basic vst in foobar to advanced "surround" dsp. and most with settings. also they all have a little something that might go better with one headphone or another. or be good for very old albums, but too much for modern recordings. or simply mess up the signature too much for you.
I feel that it is a very personal process to find the right software with the right settings(and I guess it's true in a way, as the delay should be relative to the size of your own head to feel real).
anyway I happen to use both hardware and software, but only for circumstantial reasons. on my laptop I use a dsp, when commuting I use the hardware from the leckerton uha760 simply because I "need" the amp(hiss, volume control), and because the surround effect on my sony(a867) sucks bad ^_^. I'm happy with both situations, but I'm not sure I hear the benefits from buying some gear just for the hardware crossfeed capabilities, if you already have a software that satisfies you.
when I didn't have the leckerton, for albums that really suck on headphones I used to convert to mp3 including the dsp. it might be a barbarian way, but again just for commuting I don't need perfect measurable sound.
