I've owned my HD500 for quite a while and have always thought something sounded off with moderate or higher drive or distortion, but I just finally spent a couple hours tonight thoroughly troubleshooting to confirm that it's not a single guitar, input clipping, clipping into the MOTU, etc. I don't get any unwanted distortion when the drive is low or with a clean signal, but once the drive is turned up and there's any crunch, there's this added distortion that to me sounds like digital clipping or perhaps what's referred to as "crossover" distortion? Whatever the case, the only way I can seem to eliminate it is to reduce the gain of the signal anywhere in the chain to the point that there is no distortion whatsoever.
Again, it's not the guitar, cable, too-hot input into POD or too-hot input into the MOTU I'm using for recording. In all cases there doesn't seem to be any signal clipping, it just seems like any distortion in the pod adds this layer of unwanted digital distortion, and has since the unit was new and through a couple rounds of firmware updates.
First half of the sample attached is blackface amp with drive lowered and tube drive in front (same added distortion wherever it is in the chain) and second half is blackface with drive up and tube drive off.
It's quite noticeable at chord hit at 0:08 and again at 0:25 where the playing isn't so hard yet it's still there.
After troubleshooting this thoroughly it seems to me that it's just how the HD500 performs?
distortion.mp3