Weatherb,
DSD and PCM is BOTH played back natively in Lampi Dacs.
DSD will either be an add on option to the normal Lampi Dac (whic is PCM) or you can buy a DSD-ONLY Lampi dac which will NOT play PCM in any shape or form. If you convert PCM music to DSD via computer program (Saracon/JRiver PC, etc), then you can play that back on a Lampi DSD-only Dac.
However, if you have a L5 with the DSD option, it would be best to play back PCM natively via the PCM section of the Dac and DSD, via the DSD section. You can use the remote to toggle inputs to the Volume Control/preamp selector. DSD is filtered and sent as an analog signal to the volume control.