AppleTV variable output trade-offs?

Hi - iI am using an AppleTV as a music server with just WAV files feeding my Reimyo DAC, and turned the variable output ON in order to control it thru my iPod Touch remote feature.

I was wondering if this feature is affecting either resolution or quality since I do not know if this control works or not in digital domain, I recall an old Wadia 6 I had which DID affect resolution as one moved volume down.

Any word to clarify this will be appreciated.