I got a few requests to post impression from my comparison of the D1 and D2. I am no writer/reviewer so I apologize if I am not going into details the way that you might expect but then these are my impressions, not a review.
First off, the differences between the D1 and D2 are small, but real. There is not a night and day difference by any stretch of the imagination, it is subtle but in all ways the D2 is an improvement over the D1, its simply on another level. I look forward to reading project86s impressions as I know he has/had access to more expensive SOTA Dacs.
The D1 is already a reference quality DAC IMHO and is easily one of the top performing DACs available. Unlike Project86 I cannot compare to a really expensive DAC as I dumped everything that I did have after I had a good listen to the D1 and I really only had the D1 and D2 side by side for a relatively short amount of time (month). Long enough however to form some opinions. I used both the logitech squeezebox touch and a PC source for the USB input as well as a PC feeding coax. The logitechs are running a custom build to support a greater range of sampling rates (EDO plugin). The source material was my FLAC collection. The headphones were HE-500s, Sennheiser 650s, and Audeze LCD-2 r2.
The main differences between the two can be summed up by attack, overall management of complex music (micro dynamics even in the presence of notes with a greater dynamic presence), decay, and soundstage. On the leading edge of notes whether it was the snap of a snare, cymbals, guitar string, or piano, you could hear the slightly more coherent and present initial attack of the instrument on the D2. This took direct A-B comparison between the two in order to notice it. I could not do so from memory (I tried) which speaks volumes about the capabilities of the D1. Whenever the music got complex you had the sense that either of them could effortlessly handle anything that was thrown at them, but the D2 did so with just a bit more aplomb than the D1. Again, you would really have to have both on hand to hear the difference as they both sound good but having heard them side by side the difference was tangible. The D2 could also handle the microdynamics with a finesse and purity which was absolutely stunning. I truly thought the D1 was the king in this department but the D2 managed to edge it out ever so slightly imparting a more intimate and emotional experience. Very few systems can draw me into the music like my main stereo but aside from pure dynamic impact, the D2 managed to match the level of tangible emotional engagement just as well, which caught me off guard. The combination of the D1 and the HE-500 was in some ways (micro dynamics) more accurate than my main stereo but perhaps there was just that little bit of missing emotional element which kept it as a second place. For me, I have yet to hear any headphone setup that can match a good full bandwidth stereo system for scale, soundstage, and pure dynamics but still, the D2 was quite surprising as it easily was capable of a level of subtlety that I had not heard from anything other than a very high end system driving full size pure ribbon or planar speakers. With both the HE-500 and LCD-2 as the interface between the D2 and my ears, the music was conveyed with an honesty and transparency that I always found lacking with lesser DACs. I find the anedio sound to be refreshing in its accuracy without the typical treble lift or midrange punch found in some other systems. You would never call any anedio product 'warm' but thats only in comparison with the plush sound of some systems. Because the D2 is absolutely free of glare or grain, the sound is smooth which is what I feel is the most appealing about systems that tend towards more warmth, but it is also different as it manages to be smooth without any loss or exaggeration of detail at any level, a truly magical combination.
Where I feel the D2 has the biggest advantage over the D1 is in terms of decay and soundstage. Listening to a studio recording I could hear farther into the room. This is not about separation or placement of instruments which is already excellent. This is the decay of vocals and instruments into the room environment giving a greater sense of space around the stage and a more palpable sense of its size. Its almost as if you can hear into the emptiness of the recording venue. I know that sounds weird but that is how I picture it. The overall coherency of the soundstage is also just better with the D2. It all just blends together into a more believable and realistc presentation. This is taking nothing away from the D1 which was already stellar in this regard, it is just a notch higher with the D2. I am sure project86 will have more to say on this and other differences as he has a good ear, more equipment for comparison and a larger selection of headphones. For me the highest compliment I can pay to the D2 is what I put in my original response "Have no interest in looking at anything else. Happy, content, just loving the tunes." For people that know me personally this is the highest praise I would place on any product as they know me as the guy that always finds something to complain about. I think that the D2 is probably the best money I have ever spent on my audio addiction. Anyhow, that is my 2c.