Bel Canto DAC3.5VB MK2

What do you think of difference between the two DAC's? Is the 3.7 that much of an improvement over the 3.5. Also, do you use the CD2 transport?

I  owned this dac, and a dac 3.7, it does digitize the analog signal, I used my dac as a pre amp with my turntable for years, even though the IDEA of it sounds wrong, the overall sound quality is very good. I auditioned many analog pre amps that actually did not sound as good (much higher noise floor, hum and hiss) only the Rogue audio RP 7 and the Asthetix calypso sounded better in my system. 

I was curious about your question since I have a Bel Canto DAC 3. Looking at the manual for your DAC, one of the design features listed is "110dB dynamic range 24/192 ADC input for your analog sources." I would think that means that an analog signal going into the analog inputs is converted by an analog to digital converter, ADC, to a 24/192 digital signal which is then controlled by the same volume control as any of the digital inputs.
But that’s just conjecture on my part, I’d recommend you contact Bel Canto directly for an answer.