Going by the
FAQ tab from the Lokius page there is this:
Let’s talk tech. What about balanced to SE and SE to balanced in Bypass mode?
Balanced uses one phase of the SE, SE uses the positive phase of balanced.
I've not tried using Lokius as a multiplexer or switcher between two components, but would assume standard input values of 4V on balanced (from Modius) and 2V on SE (from Mani) and maybe you're getting some kind of signal imbalance in passive mode from the phase being used by the balanced inputs... This is just a guess based on the Lokius FAQ description of Bypass behavior, and I probably have no idea what I'm talking about.
Certainly worth an email to the Schiit folks for clarification in addition to asking the fine Schiitizens that haunt this place. Best of luck with a resolution to what sounds like a very frustrating situation!