More than you probably want to know follows.
Reference level is a little tricky to understand if you are not familiar with studio equipment. When setting the reference level, you are calibrating your digital inputs and digital output level to equal, for example, -18dbFS when being fed 0dBVU. 0dBVU is the “0” midpoint level on a traditional analog VU meter.
The confusing part results because 0 on a dBVU meter is not the highest signal level a system can handle, it is just a reference. There is a lot of headroom available above 0dBVU. On the other hand, 0dBFS on a digital system is 0dBFullScale, the highest level a digital system can handle before distortion.
Thus, you need to calibrate a digital system to a reference level that makes sense. -18dBFS is common. That is, calibrating the system so that a digital dBFS meter reads 18dB below full scale when it receives a signal which a dBVU meter reads as 0dBVU.
On the DA-3000, the inpout and output reference levels can be set to -9dBFS, -14dBFS, -16dBFS, -18dBFS, or -20dBFS. The default is -16dBFS.
Now that you are thoroughly confused, you can enjoy knowing none of this will matter to you.
Feed the DA-3000 an analog signal where the peaks do not reach over 0dBFS indicated. Aim for peaks of perhaps -6dBFS on the DA-3000’s meter. You can later increase the overall volume in your recording software in production (after the recording is done and ready to be processed). When recording live concerts, I aim for peaks at roughly -12dBFS. This allows of lots of headroom for the unexpected burst in the excitement of performance. I can always later raise the level later in software.
Typically you will not use the input level control on the DA-3000. The preferred method is to control the output level of your source feeding the DA-3000. This can be a microphone preamp, board console/mixer, or ADC. Only use the input level control if your source does not have a level control and then only if you must use it to get a clean recording that is not compromised by a low S/N. Remember, you can always increase the level in software later.
Keep in mind you cannot hurt anything. The worst thing that will happen is that you make a recording that stinks. And this will teach you something. Start by recording an LP track at a time and get a sense of how everything works before starting to work on full albums. And remember you can record a CD, or any other digital sound. This can be great practice. Also, remember the DA-3000 is a good DAC as well and the headphone out is decent. You can setup how everything works together in many different ways. Be sure to play with DSD as well .