So I went ahead and purchased the DMP-Z1 and have had a chance to play with it a bit.
Still in the early stages of testing but one of the fun things I've done is gone back and forth between battery and AC mode with various headphones. Using battery power significantly reduces the noise floor with the IEMs that I've been testing. As someone very sensitive to any kind of background static or noise of any kind, this alone may have justified the cost of entry. I'm somewhat concerned about battery life and the possibility of the batteries degrading overtime but Sato-san assured me at Canjam that it is no different from the rest of the Walkman series - it will be easy to send the unit in for battery replacement should it be needed.
So far I have tried the Westone W80s and FitEar MH335DWs using the unbalanced connection. These are both highly efficient earphones so don't benefit as much from the added power but the Z1 adds separation and a cleanness to the music. Compared to some of my other players, it certainly isn't night and day but I would describe it as going from an A- experience to an A. It will take more critical listening determine further benefits and I look forward to trying the balanced connection and using the Z1 with some larger headphones (and will answer my own question about how the Z1 plays with the Stellia).
For anyone else that has the Z1, in some of the marketing materials they should two dials being displayed (displaying sound levels?) on the Z1's screen. I haven't been able to locate this display at all and couldn't find any reference to it in the product manual. Has anyone had any luck activating this display mode or was it something that only exists in marketing materials?
Congratulations for your purchase. Enjoy your new toy.