In Audio - Advanced there is an option to play HDCD directly without conversion. This is meant to be used to send a 16 bit HDCD file to a HCDC capable DAC. You might see if that is honored during conversions.
Yes this box was checked. If I uncheck, it will convert the file as 16 bit like it should and rerunning the audio analysis on the converted file, it is correctly flagged as HDCD so all good here.
However...This is not correct behaviour. This setting should be ignored when converting HDCD files.
There should be 2 settings. One under advanced and the other under conversion settings:
For Conversion:
Under Audio Conversion Options -> Convert HDCD file to 24 bit check box.
For Playback:
Under tools->Advanced -> Option to play HDCD without conversion check box (and rename it this way so it is clearer rather than "Play as HDCD if possible").
(or maybe in the DSP settings instead?)
Thx for the pointer DTC.