I can't help but wonder if what's happening here is like tube amps and analogue playback (eg. vinyl). Objectively the DSD conversion adds distortion but the anomalies are not perceived as objectionable and in some material, the added noise and imprecision actually makes it sound less "sterile", "clinical", more "real" (conversely being in an anechoic chamber is disturbingly unreal due to the profound silence). It would make sense to me that some people could prefer DSD64 over DSD128 upconversion since DSD64 will give you more of that distortion. Even though the noise is ultrasonic in nature as measured off the DAC, nonlinearities in the playback system like your headphones and speakers (perhaps certain amps as well) could create audible intermodulation. Maybe for certain music, this could be especially beneficial.