OK, I think we figured out what was going on... at least to some extent.

Good news are that all weirdness that I described above was caused by the Tone Defeat and the extra bass (cured by the reset.) It is very easy to repeat. Play a CD via digital conection (choose something with well defined deep bass, or something with female voice and piano), choose Stereo, and then start switching the Tone Defeat ON and OFF on the remote. As soon as the Defeat is turned off, the midbass is bumped up, the low bass disappears, the midrange (piano) is getting subdued, and the harshness is there. The soundstage shrinks considerably too. Turn the Defeat on and the soundstage expands, bass is getting smoother and lower, and the harshness is gone. I wrote above about Renaissanse Novella CD - now with the Tone Defeat ON, switching between the Azur player (analog bypass) and the 990's DACs virtually does not cnange/color the sound. But if I set Tone Defeat to off, the piano steps backs and the voice gets harsher. Wow!

Here are maybe not so good news. I listened again to Diana Krall, Procol Harum, Bjork, Steve Hackett, Tori Amos DVDs in DD and DTS, and comparing to Cary they still sound different. Soundstage seems more narrow, and the timbre is different and it seems harsher too. DPLII Music also seems to bring the harshness, and the Tone Defeat has no effect if either mode of DD or DST is selected. Try playing with the Tone Defeat in Stereo until you understand what effect it brings, then leave in ON and start switching between Stereo and DPLII Music - I bet you'll hear scary similarities.

So it looks like the DSP processing on the 990 is not quite up to... well, at least my expectations. I hope some DSP (not just system) code will be updated with the firmware release, but I'm not holding my breath.