Can someone explain

It shouldn't. Using the headphones out from the Dell utilizes their analogue out, which is pretty poor (I have one). Only thing I can think of is your DVD is pretty poor (like an Apex or something? I have an Apex hooked to Dac that I tried just for giggles-into Monarchy DIP/MF Dac3/PSU). The DVD/Dac should be much better than the mini out.

The DVD is a Denon 2200, into a Adcom GDA-600 DAC. Just when you think you have it all worked out, something happens to change your mind. I'm starting to become disenchanted with what sould be better and just be happy with what is. Maybe I'll try a usb converter or dac, but for now I'm just to busy enjoying the music.