>> You probably have separate DACs for the MP3 player and the rest of the
>> phone anyway.
>
> You reckon? I would have thought space and power consumption
> considerations would preclude that.

Well for power consumption the DAC for the the phone conversations can 
be much lower quality.  It wouldn't surprise me if there was a clever 
DAC that could be switched between low-quality-low-power and 
high-quality-high-power mode.  There is all sorts of stuff like that in 
phones.

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