I've been experiencing this harsh clipping on my Timefactor on the VintageDelay model. I drive my signal a little hotter via my compressor, sometimes diming both Level and Sensitivity knobs (its an RMC FK-1 Compressor – Ross flavored comp) in order to get some sweet sounding grit onto the guitar tone. With the Vintage model selected, with the Bitrate at 9/10bits or more, it clips very noticeably, and not in a nice way. This clipping does not happen with any of the other models, and goes away with the gain trimmed down on the front end. It's a damn shame too, because I particularly like the Vintage model. I run the Timefactor in my Diezel Einstein's serial loop, so I'm confident in the loop's quality.
Please, let me know what i can do about this, it's been very aggravating and annoying for a long time now. I was hoping the latest update would do away with it, alas it did not.