I read the article! I thought it would be too long to be worth reading, but instead all the criticisms about it were too long to be worth reading!! It explained what dithering is and what it does
So, I'm not too sure how that applies to FAAD? If you're trying to play a 24bit AAC file on a 16bit system?
And btw, I've used 8-bit audio quite often. I've found the high pitch artefacts on bass lines quite nice

That's the only time I've seen the square wave effect. (sorry, the square stepping or whatever)