Check your amp gain, even though astell&kern says it only works in low gain this is not the case. The gain settings affects the sound level dramatically. I use the device in high gain with my headphones because it sounds best to me but if I forget to switch it back to low gain it affects the line out playback which I also use frequently. I usually use line out in low gain 2v except in my car which likes .7v for whatever reason. In my kenworth tractor trailor which has a crappy stereo that does not play loud enough, I use mid gain and 1.25v to "force" it to play louder which actually works quite well and sounds better then it should. If you were to leave the amp in high gain and use line out I could see it overloading a lot of devices inputs.
You are 100% right! the bloody Amp was set to High, and I didn't know it affects the Line out.
I changed the Amp to Low and did a Stereo Chanel Test, yes the Distortion gone!
Lucky me if I didn't see this reply, I would be sending this dap back to A&K for repair LOL
Now I'm positive that there's nothing wrong with my KA.
A&K didn't mention this, I think even they didn't know cus they are not smart enough LOL
Huge Thanks m8