Hello,
For those having issues with the K3 (and maybe others?), I can confirm it is a driver/software issue.
I almost wanted to return it because I found it very annoying, it is very noticeable if you don't use its official driver.
Try for example the speaker sound test in Windows and you'll hear it...
If you use the official driver, there is some difference and the "muting" happens with some more delay at the end of the stream.
However before I almost gave up I went to look at the driver control panel folder (C:\Program Files\FiiO\FiiO_Driver\W10_x64) and found an xml configuration file...
Inside the XML file you will find this magic setting:
Code:
<PageOptions>
<!-- Supported values for this page: Hidden (default), Visible -->
<Visibility>Hidden</Visibility>
</PageOptions>
Set it to Visible by replacing "Hidden" with "Visible" and save (you need administrator permissions, open an editor in administrator mode and then open the file)
Before editing the file close the FiiO control panel application and reopen it after.
You will find the magic tab "Options" where you will find "Streaming" and you'll see it's set by default to "On when Needed". Set it to "Always On" and... problem solved.
Now the questions are... why this default and why is the option page hidden?
Edit:
Before finding the solution I recorded the issue:
Prodigy Cube (for comparision)
K3 with windows driver
K3 with official driver