I also still have an iPod classic and I am relatively confident that level-matched HD650 will sound noticeably different vs Atom+EL DAC. Amps/DACs don't all sound the same, there has been lots of progress in the last 5 years, let alone 15 since the iPod was relevant. Otherwise what would be the point of measuring everything? (main point of this site, really).From an "old iPod", which I actually happen to have, HD600 would sound lower and will never be able to reach the same sound levels as when driven from a dedicated amp or from a CD-player's headphone output. Still, I think that the sound quality, when level matched, would be comparable. Let's not confuse sound quality with sound level.
It's definitely not about how loud iPod gets. I always felt it's noisy, has background hiss and everything sounds thin/without body and even metallic on certain headphones. It was never any good, about the same quality as onboard audio in a computer.