Naim use DAC chips that are natively configured or only work in PCM. The conversion from DSD to PCM therefore occurs prior to the DAC… I suspect by the SHARC processor.
DSD to PCM is an inexact and ultimately lossy process, and there are many different ways of achieving it with pros and cons. It’s very different from converting FLAC to WAV for example which is precise and lossless.
Therefore you may find Naim’s chosen conversion algorithm to your liking or not. If not you can always convert separately in a separate transcoder like a UPnP player or Roon and use that conversion algorithm which you may prefer … or not as the case may be. However ultimately the best way to playback DSD is use a digital to analogue converter chip itself and digital filters that natively operate with DSD, and internally are being sent DSD/delta sigma bitstreams.
Alternatively you can use a Naim streamer with digital out, and if sent DSD, then sends pure DSD information on the SPDIF (This is known as DoP… where pure DSD is packaged up and sent in the data construct of a 96/24 PCM transport) . This DSD SPDIF signal can be sent to a native DSD DAC and that way you can listen to pure DSD, rather converted DSD that the Naim streamer otherwise play out.