It is often suggested to burn in new audio equipment, be it headphones or in your case a DAC and an amp. I suggest at least 50 hours of burn and your E9 should start to really open up and the improvements begin to become quite noticable. As for the L3 issue, are you having trouble with the 3.5mm line in input in the back of the amp? Or, is the trouble with the 3.5mm headphone out in the front? Or something else entirely?

You're supposed to use the E9+E7 combo through USB w/ a computer, not through a LOD. If you use a LOD you're not even using the DAC section of your E7.