On the subject of possible mistakes with voltage/power levels, I can't see how this could be causing your problem.
1) The O2's input stage would be clipping if the voltage levels were performance-compromisingly wrong, which occurs independent of volume control position (volume control between gain and output stage).
2) Quoting NwAvGuy on the measurements of his amp:
"I've run the O2 at full power into 15 ohms with sine waves for several seconds at a time and haven't noticed any changes in its measured performance let alone had any failures despite the fact the dissipation per channel is (briefly) over 2 watts"