AK4358 DAC DSD question

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I have a SONY DVP-LS785V palyer. It has a AK4358 DAC,

http://www.asahi-kasei.co.jp/akm/en/product/ak4358/ak4358_f01e.pdf

It says tha "accepts" DSD data but, DOES IT CONVERT DSD to analog, or converts DSD to PCM and after this to analog?

If it does DSD to PCM... Is this very important for sound quality?

My other player has a WM8524, a new dac from WOOLFSON... is this chip good enough? Is as good as AK4358?
 
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