It is indeed balanced all the way through.
However when using a dCS DAC one for such a comparison it is not just comparing some kind of conceptually ideal XLR connection with a conceptually ideal RCA one. Unlike most products offering RCA and XLR outputs dCS do not simply use one half of the same output circuitry for RCA ( which is why the specified output voltage is exactly half that of the balanced XLR output). dCS DACs actually use different specially designed output circuits for RCA or XLR.
I would not say that RCA sounds better than XLR or that XLR sounds better than RCA ( though balanced will have better noise performance). I would, however, agree that individuals may express a preference for one over the other. So it is with just about every aspect of audio.