Cary 303 has adjustable/defeatable upsampling. If you audition one, you can compare for yourself. BTW, it also allows you to choose between tube and ss output sections.
It generally means the designer needs a more expensive sharper brick wall analog filter on the output - this may affect phase in the in band frequencies.
I disagree with Mrjstark. I generally find that upsampling yields a more analog-sounding result. I've had 12 CD players, some of both types, and I currently own one of each. My Creek CD50mk2 doesn't upsample but my Audio Aero Prima mk2 does. And I love both. But in my experience, upsampling doesn't matter as much as the output stage design, so there is lots of overlap in performance between the two types. The bottom line is you don't need to worry about it. Just enjoy the music!
I had the Consonnce CD120 Linear with Non-OS 16 bit DAC (2 DACs) and no brickwall digital filter. Smooth, relaxed, musical, yet detailed and great PRaT. Lovely analogue sounding unit. Recipient of many awards.
They make the 2.2 Reference (tubed w/ 4 DACs), Ofeo (top of the line Forbidden City, 4 DACs and better chassis), and DAC16 (DAC portion of Linear CD)
There is a purpose for this brickwall low-pass filter. Without this filter aliases of high freqencies will fold into audible band. Filter has to pass 20kHz but reject 44kHz carrier - it cannot be done with even group delay (linear phase) Bessel like filters (no matter how many poles). Result of using non-Bessel filter is wrong summing of harmonics and altered sound.
When you say upsampling you probably mean oversampling. Upsampling is particular case of oversampling with non-integer ratio and asynchronous reclocking.
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