Hi enggeek,
As a test, try inserting a DC Blocking filter into your signal flow as shown below:
As it turns out, the -1702's DACs do pass DC from their numeric inputs to their analog output pins, which can result in asymmetrical clipping -- see http://ez.analog.com/message/85908#85908
If adding the DC Blocking filter makes a difference, check your input circuitry for anything that might put a DC bias current into your ADC inputs (such as leaky coupling caps, or attempting to DC-couple the ADC inputs). The ADC inputs must be AC-coupled (or very carefully DC coupled from a source with the same quiescent level, about +1.5 V dc -- see http://ez.analog.com/message/42692#42692).
Best regards,
Bob