Before replying I thought I would actually try out the two inputs - USB against optical - using my standard test tracks. This was with no charger on Hugo 2, and a modern Win 10 lap-top that was mains powered, but listening on headphones only - so there is no possibility of ground loops.
My lap-top (MSI) has optical out too, so I could compare optical to USB from the same source. The benefit of optical is it is completely galvanically isolated.
Comparing optical to USB, I struggled to hear any difference at all. Which was unusual, as USB normally sounds a tad bit brighter, but I could here no change in instrument separation, timbre or timing. Its possible that depth was a tiny bit better with optical, but that impression was only once on 4 switch-overs.
So I thought maybe today was a bad day for listening, and tried listening between the initial version and my production version, which has production code. Immediately I could hear better depth, instrument separation and focus, and a less splashy SQ on difficult tracks, which are the SQ improvements I have wrought recently (with better measurements too).
So my conclusions are - don't bother with galvanic isolation when using headphones and modern lap-tops. It should help when using Hugo 2 as a DAC into a power amp though - I will try this out later.
So why is it less sensitive on the inputs than before? Well I think that is down to a number of things. For one, USB ground and VBUS is completely RF filtered now, and each digital input has its own PSU separately RF filtered, including the USB decoder. The DAC section is much more immune to noise than before, and much better isolated - I am getting crazy levels of measured cross-talk from one ch to the next - the separation is an astonishing 144 dB (I had to check this measurement figure a number of times with different units as I didn't believe the numbers), and that's a testament to the ground and power supply isolation and DAC noise immunity that I have put into Hugo 2. Also modern lap-tops are much more power efficient than before, so create less noise.
Oh and I have issued production code to Chord earlier this week, and the production units will be on show for the first time at Can-Jam Singapore.
Rob