VLC has a myriad of options for the audio setup, you might have to use the show all settings radio button to get to advanced settings mode to see the culprit: I hope not.
I appreciate that VLC lets you have a volume over 100%, but that may be the problem you are having.
In the simple audio settings, unless you have a reason to do differently I’d turn off , set replay gain mode to , set Dolby Surround to , turn off and perhaps set the <always reset audio start level to 100%> If that fixes it you don’t need to waid thru the many, many audio settings in advanced mode.
Since iTunes is nominally working you want to run the bit perfect test I mentioned earlier to check that there’s no subtle processing going on that might be affecting sound quality.
I’m sure you’ll hear changes from 45 hours to, say 100 hours or perhaps 500, but I certainly wouldn’t wait for 1000 hours to just sit back and enjoy the DS. On the other hand, until you can reliably sent the bits out of your computer without modification (at least when you want to) you don’t know whether you are hearing the “real” DAC or the results of who knows what processing.