Pioneer Elite VSX-84txi & iPod: where does D/A conversion occur?

Hello, first time poster!
I have a question that I can't seem to find the answer to in the owner's manual or on the net and perhaps some knowledgeable person could help me. I own a Pioneer Elite VSX-84txi manufactured in Nov 2006 and a new model iPod manufactured in late 2008. The Pioneer has the latest firmware update. I use the Pioneer supplied iPod cable included with the receiver to connect the iPod to the receiver.
With Wadia pushing the i170 transport as the first solution to bypass the iPod's internal DAC, I was wondering if my iPod passes a digital signal to be decoded by the Pioneer Elite VSX-84txi or if the signal is decoded by the iPod's DAC and passed as analog to the Pioneer. Essentially the answer to this question will dictate whether or not I buy the Wadia i170 (I don't care about video, just the audio processing).
Thanks in advance!!!
Dan

Well, I received this reply from Pioneer today:
"Thank you for contacting Pioneer Electronics, Inc.
The signal is decoded by the iPod and passed as analog to the Pioneer receiver.
Thank You,
Ismael
Customer Service Representative"
So I guess I'll be buying the Wadia as the Pioneer iPod connection confers no advantages other than charging the unit while it plays.

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Pioneer Elite VSX-84txi & iPod: where does D/A conversion occur?

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