Yes, you can use JR as an UPnP server, but then you have to use a "standard" UPnP Control Point (like Kinsky for iPad), but JRemote will not work as an CP for this configuration.
If you use Catwalk, then you use the "standard" JR playback mechanism and Catwalk will do the UPnP part for the Linn DS. Then you can use JRemote as an remote control for JR (and thus for the Linn DS). One big advantage of this configuration is: The pure UPnP "Server - Control Point - Renderer" stuff is a "one way street" by UPnP design
e.g. you cannot rate music tracks with stars while playing. Using Catwalk & JRemote the stuff works "two way": you can star rate tracks with JRemote while playing and these ratings are stored in the JR database (and in the music files if you want). By using Catwalk the Linn DS works as a "master", it has the whole playlist "onboard" and fetches the tracks from the UPnP Server (JR & Catwalk). When the whole playlist is in the Linn DS, you can also use the "next", "prev" track buttons of the original Linn DS remote control, you can navigate through the whole playlist with the remote and the Linn DS display.
I have tried to get this to work without Catwalk (then JR is the "master" and feeds the LinnDS track by track), but I never got gapless playing to work and without Catwalk you only have the current playing track in the Linn DS playlist / display.
Regards
Eberhard