Problem with Upsampling on DAC


I have an MSB Dac III with upsampling that can be switched between off and on. When I turn upsampling on it sends distortion into the tweeter of the left channel.

I have a Linn Aktiv system from preamp to floorstanders. The Source is a CD 400CD MegaChanger. I just hooked up the MSB DAC Link III with Upsampling and HDCD, via the optical connection to the CD player, and then RCAs to the preamp.

When upsampling is turned off, the DAC plays well. When I turn upsampling on, I get distortion - only in the left channel tweeter. (Recall, this is an active system, so the tweeters have no passive crossovers and get the filtered high frequency directly from a dedicated amp.) This happens as long as there is volume at the preamp. The distortion stops when the preamp is muted or when the upsampling switch is turned off.

Any ideas on what may be causing this?