Martian,
If you like how the Belcanto sounds, what's the problem? The sound is the most important part, at least for me.
Upsampling and oversampling are indeed the same thing. Both are sample rate converters. Both increase the number of samples by some factor (2, 2.18, 4, 4.35, 8, or whatever). Both will need interpolation to assign a voltage (amplitude) value to the newly created samples. Although a separate process, both may increase the word length from 16 bit to 18, 20, or 24 through the appropriate use of dither (basically white noise). Both may use a dac of various resolution (18/44.1, 24/96, 24/192 or whatever).
As Charles Hansen (research director for Ayre) said in the article I posted above, "Upsampling and oversampling are the very same thing and anybody who tries to tell you differently is misstating the case... And there's nothing unusual about putting two digital filters in a row -- virtually every digital filter is a cascade of 2x stages, because it costs less than accomplishing the entire filtering process in one go".
The reason why turning off upsampling on a capable player changes the sound is that you are taking one of the digital filters out, Particularly if it was designed to utilize the computing efficiency of two digital filters, it is likely to sound worse with only one. Again, Charles Hansen: "upsampling almost always makes a difference, and it can make an improvement".
In the end, it's the sound that matters. If it sounds better and the mfg happens to market using the "upsampling" hype, then fine. I do appreciate mfg's who talk straight about the topic though and if two products sounded identical (or maybe I should say the final subjective value I assign to the two products are the same), I will award the straight talking mfg with my business. That's just my philosophy.