Be clear, once the system unmutes, the performance is going to have the base linearity the DAC provides. Getting tied up in knots about a "flawed" or "poorly engineered" product when no-one even knows what the time constant on the mute function is is just plain silly.
What mute "function?" There is no such feature in the manual or specifications for the product. Nor is there any benefit to any user to have such an "auto mute" function.
And if you are going to have one, why draw the line at 15 bits/90 dB?
Why is there no indication on the display that some kind of auto mute is activated? Why is there no option to turn it off?
The only reason I know this is done is to cheat and make signal to noise ratio tests look good by muting low level signals. That is certainly not a benefit to users and is a common way to cheat in measurements.
As I indicated, there is a blinking status indicator of PCM samples. That tells me it may be having difficulty locking to input values.
Out of nearly 300 devices I have tested with DACs, only two have failed the test this way and both are AV Processors. No way this is a "measurement problem." No device that advertises at least 16 bits of resolution should auto turn off its output this way let alone 24 bits.
This problem needs to be properly identified and fixed. By defending it as a feature and not a bug, you are postponing or eliminating this opportunity. Nothing about this test is unusual or "test specific." A DAC has to be a DAC. You give it a -96 dB signal, it needs to produce a -96 dB signal.
Note that this test hugely favors manufacturers already. All noise and distortion is discarded in the capture and all it looks for is an amplitude that is correct. To fail even this test means that the unit is not working as advertised.
And no, this is not like a subwoofer auto-on. The sub will turn on and stay on. It doesn't keep turning on and off like this device does with no indication it is "muting."