I noticed I can raise volume to max, and I have sensitive ears which I usually listen to music on mid level volume. So I was surprised to know that my 7XX did not become uncomfortably loud. Am I missing out on anything?
Gain. That kind of effect isn't just based on power, it can just be high gain. The Rega Ear for example has +26dB gain, even with otherwise very low power output, and some people think it has amazing levels of output power because it can blow your eardrums at just 11:00, but by that point distortion is setting in. It doesn't help that it has high output impedance too (something they remedied on the Ear II), and something that is also likely a problem with your receiver because speaker amp manufacturers unless they have the same teams who did their newer headphone products having an input would tend to forget that low impedance headphones exist.
Elite SC-65
› Channels: 9.2
› 720 W Multi ch Simultaneous Drive (1 kHz, THD 1 % @ 8 ohms)
› 210 W/ch (1 kHz, THD 1 % @ 4 ohms)
› 170 W/ch (1 kHz, THD 1 % @ 6 ohms)
› 130 W/ch (1 kHz, THD 0.08 % @ 8 ohms)
This only states speaker output specs, nothing on the headphone output power much less output impedance.
No info relevant to the headphone driver circuit there either.
Would I improve my sound with a preamp and/or a DAC? I noticed on my receivers page it states."192K/24-Bit DACs"
Not sure how the preamp would help your headphones or your speakers, not to mention your receiver already has a preamp controlling its output.
As for the DAC, it won't do much good if it's just a DAC, since you'd need to amplify the signal after the DAC. Which means even if you can use one you feed it back to the receiver, and all it will do is make you give up surround decoding.
In any case, if it has a line output that works with all sources (double check this because some receivers have a restriction on which outputs work with line output, ie, it usually does not work with digital inputs; only preamp line output works) then maybe add a headphone output there. If it has SPDIF output then you can feed a separate signal to the DAC-HPamp for driving headphones.
That said, there's no guarantee that there will be any significant difference or that you'll hear them and consider them worth the expense. For one, as much as I'd suspect speaker gear by default, doesn't automatically mean all of them will totally suck with headphones, so the differences might not be siginificant for you to hear or think the money was well spent. And then if the high output impedance actually boosts the bass and you get a less distorted sound from a headphone amp with low output impedance you might think it's the headphone amp that sucks.