It would give you a chance to understand the meaning of the citation.
It tells that if an incoming signal is marked as 24 bits, but the stream is in fact in 16 bits, then 16 bits are shown as coming from an analysis of the stream.
"Analysis of the stream" is not a very precise definition ... What does it actually do ? Look for all samples containing zero in the 8 low bits ? Again so what ? All that your interpretation says is the DAC may decide the stream contains fewer useful bits than what's advertised.
How can that possibly lead you to believe that somewhat the WiiM is sending more than 16 useful bits of data even when it pretends to only send 16 and that the DAC will somewhat retrieve those bits and use them even while only displaying 16b are being received ?
You just don't make any sense here.
I still have to see any actual evidence of this rather outlandish claim since it would imply that both the WiiM and all the DACs out there are violating the protocol standard.Fact is that it does not happen.
I instead what we so have a logical explanation as to why attenuation of 16b into 16b will by necessity lose resolution along with some users observing this via audible distortion at very low volume which correlates.