Unfortunately, Apple will not allow us to process the audio for the USB digital output. They limit developers on this because they think we would steal DRM protected media. You know when your device is using the USB digital audio connection when the song names appear on the playback device (your receiver) and DPS does not have an effect.
There is also an analog audio connection on the dock connector. That is what most iPod docs use. DPS can process this signal and the profile for that is in the Line Out menu.