Interesting video. Silly but interesting. There is no basis for saying that the analog waveform coming out of your DAC is stairstepped or "tic tic tic." But I can easily believe that processing the musical file by adding reverb and EQ can affect the listener's emotions. It would be an interesting research project to find out if certain recording techniques correlated with measurable emotions in the listener.
I use a processor in my playback chain (BSG QOL) that adds depth and focus and I would bet that my emotional state is better when I use it than when I don't. I don't have any issue with Levinson's technique to improve the sound of recordings, I just wish he didn't rely on technobabble and new age claims of improving one's health.
One more thing. I have a pretty good library of LPs and CDs and I play both regularly. I have never been able to perceive vinyl to be inherently superior to digital. At least on my system, the SQ is dependent on the recording rather than the format. I suspect that if you used Levinson's real time processor on a vinyl record it would have the same listener effect as for digital.