Thanks for the honest comparison and personal impression!
Mine is Dragonfly 1.0c, and it does sounds more spacious and transparent than X3ii. But for transparent sounding IEM like my DN-1000 and DN-2000, they sound more balance with the X3ii, though I also like them with the Dragonly.
I guess you like transparent and open sounding sound character. Some people might prefer warmer and full bodied kind of sound signature, like the Astell&Kern house sound. Recently I compared X3ii with AK Junior. AK Junior still carries the warm and full bodied midrange and bass from AK house sound, and probably a better choice for bass lover. But X3ii sounds more transparent than AK Junior, with better spaciousness. I tested them with DUNU DN-2000. So, it is pretty much on personal preferences, not about which one sounds better. Also matching with IEMs. Bright IEMs would probably match the AK better, while those who prefer transparency and spacious sound would probably prefer X3ii (or Dragonfly)
I wonder if the Dragonfly 1.2 is more neutral than the original. Because to my ears it didn't sound less so than the X3ii.
Possible. I haven't tried the Dragonfly 1.2. But I really like the 1.0c. Simply one of the best bang for the buck USB DAC.