I've been experimenting with the uDAC-II, and I was just wondering...
I'm currently using it as the DAC for my MBP, using the RCA out to an H/K AVR 145, so basically the uDAC-II is acting as a sole DAC (as per its function). I know that the uDAC has some kind of opamp in it or something, but things are noticeably louder when the uDAC is sitting in the middle of the chain. Is it right for me to assume that this technically gives the uDAC a sort of "gain function" in the chain when using it in this manner?
For example, I'm noticing differences when turning up the volume knob on the uDAC as compared to the connected amplifier source. Using a FLAC source with no audible clipping, when I put the volume up on the uDAC, everything is pretty much balanced (in fact, the mids come out quite nicely, and when paired with the AVR 145, the bass becomes nice and full and not bloated). Doing it the other way, however (putting the volume up on the AVR instead of the uDAC), the treble becomes harsh, and the vocals become rather sharp and ear piercing.
In the end, I "mix and match" the volume levels on both devices to kind of find a "sweet spot" between the two. Am I getting at the right assumption here that the uDAC becomes a sort of "gain switch", or is it all in my head? 
A DAC will have an analogue step as part of its function (digital to analog) -- the output gain differs per DAC, and can usually be adjusted with the knob on the DAC. This is the "gain" you are talking about. This is actually par for the course with most DACs.
as for getting better sound using the uDAC's knob as opposed to the amp, yeah what's happening is you are making the source signal going into the amp stronger, so you don't have to overdrive the amp. What is likely happening is you are overdriving your amp when you turn the knob up -- amps typically perform at their best from 9 to 12 oclock on the volume pot. Any more than that you are usually overdriving already and getting distortion into the sound.
That's why the source signal from the DAC should be nice and clean.
I'm not sure how the uDAC 2 works, or even the uDAC one, I remember that the uDAC 1's lineout was adjusted with the volume knob of the amp, meaning the line out went through the opamp and could be adjusted via the pot -- which is unusual. Usually the lineout is just the maximum strength signal going out.