How to tell if a CD is Encoded?

Yep. If it says "Compact Disc Digital Audio" it is one and only one thing: Redbook, which is PCM at 44.1kHz / 16 bits.

There’s no correlation in my mind between the encoding method and DAC reproduction or sound quality.

I will say that over the past 5-10 years, DAC’s are MUCH much better at playing Redbook than they were before, to the point they make hi res and DSD recordings much less relevant.

So if anything, I would say that listening to a modern DAC is important.

Best,

E

Myth vs Truth, DSD and PCM

https://www.mojo-audio.com/blog/dsd-vs-pcm-myth-vs-truth/

Important to note that a lot of SACD's aren't just re-issues, they are completely remastered. Listen to the one that sounds best to you, but we can't judge the relative encoding merits with those. 

All SACDs are DSD

some CDs are based off analog tapes that have been remastered in DSD

some DSD recordings can be purchased as CDs

we seem to be confusing the recording and mastering (which is interesting) with the final media (which is the relevant point of your question)

as far as commercial silver discs go its red book pcm or 128 DSD that's it! Standards are standards

@geoffkait - even the vinyl LP versions of those Stones records are pretty well regarded. DSD vinyl. Dude.
@folkfreak - as an afterthought, this goes to your point about the mastering v the final medium.