Hi, same problem here
I have a late 2008 iMac running os x.6.8 snow leopard, and I use an external soundcard: digidesign mbox2 pro.
I noticed VLC introduces distortion in FLAC files. Volume set at 100%, sometimes 50%. Distortion occurs only in the loudest parts of the audiofile (I can record what's happening and what I mean by "distortion"). Sometimes it disappears, sometimes it comes back when I read the file again, it's really strange. I tried different versions of VLC, same problem every-time. No distortion when I play the same files in XLD (great software btw)
Any idea about how to solve this?