The pseudo balanced cables break the ground loop while not affecting the audio quality in
the way that your Skytronic isolator probably does. While ground loops used to cause hum
back in the days when everything was analogue, nowadays they're more likely to cause
hissing and clicking sounds in systems where there are digital devices.
I'm not
sure why Dave's box didn't work - it might help if you post some detailed photos of the
internals so that we can see if you've made any wiring mistakes.
James.
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JRP Music - Audio Mastering and Restoration.
http://www.jrpmusic.net