I haven't read the whole thread, but it seems to me it comes down to the fact that every converter, DSD or PCM, will exhibit some signature to the sound, good or bad, desirable or undesirable, likeable or unlikeable.
When DSD first came out there were problems with it, i.e. artificially 'softened' edges and dynamics (a type of distortion), but these problems were (to my ears at least) fully overcome by the Grimm AD1, which managed to achieve amazingly low distortion and great sound with their design. But there is still the problem with it only operating at 64x and the inherent HF noise above 50khz.
The recordings done in DXD (352.8khz/24bit PCM) by 2L and downconverted to DSD do not sound as good to me as ones made with the Grimm AD1. It's because the distortion isn't kept as low and is above audible threshold and I hear some 'softening' and 'rounding' of the edges, i.e. distortion. This seems to be a problem with higher sampling rates, both for PCM and DSD. That is, the faster the sampling, the more distortion and/or the harder it is to keep audible distortion at bay.
I know Jared Sacks has experimented with and tried other DSD converters that operate at 128x and 256x, but he says the Grimm still sounds the best (and I think he still goes out of his way to still use it most of the time). Eelco Grimm says he/they could make a DSD converter that does 128x DSD with equally low distortion as 64x on the AD1, but not one at 256x.
Maybe I'm biased since I'm partial to the Grimm and its ultra low distortion, but I would think a design of theirs operating at 128x would trounce everything else by a wide margin. After all, even 14 years after it's come out, the AD1 still arguably sounds the best. If only they would make an AD2 at 128x. Maybe someday they will.