Your chain looks like it should. It is lossless up until it goes to the Powernode 2i and gets decoded to MQA. Then it becomes ‘enhanced’. It doesn’t matter where in the chain this signal modification takes place. When the signal becomes modified, it will show as enhanced.
If you were to go into the Device Setup for your Powernode and set MQA Capabilities to No MQA Support it will go back to magenta.
Yes. If MQA decoding takes place, the original bits have been changed and thus the signal is ‘enhanced’.
It’s important to keep in mind this doesn’t mean it’s worse, it’s just different. If you use any type of DSP, the path goes from Lossless to ‘enhanced’. In most cases the sound is truly enhanced (IMHO), even though it is no longer bit perfect.
It will only ever show enhanced if your DAC is MQA capable and you feed it an MQA file. Otherwise it will remain blue indicating an unaltered lossless file. If it is a problem, you can turn the processing off but it may be desirable to simply leave it on.