Sony SCD-1 balanced or unbalanced?

I am using singled-ended with my SCD-1. To me I really do
not see why I need to use XLR connections because my SCD-1
and pre-amp are on the same rack. XLR is designed for very
long cable runs, e.g., from microphone to recording console.
For usual high-end equipments I do not see the point of using XLR or fully balanced circuitry. (If your pre-amp is three blocks away, then you should definitely use XLR.)
On the other hand I am using the Transcendent Grounded Grid
pre-amp with SCD-1 and I am very happy about it. I would suggest you give GG a try, and you can even build it yourself for $500! Several months ago when I was looking for a tube pre-amp to match my system, I was thinking about
Audible Illusion Mod 3A, and ARC LS-25, but finally I choosed GG by the very obvious reason: $$. My current system consists of:
Front end: Sony SCD-1
Pre-Amp: Transcendent Sound Grounded Grid
Power Amp: McIntosh MC-275 Gordon Gow
Speakers: Quad 989

I found that with my SCD-1 that running balanced, the unit was very inferior and sounded much better when run with single ended cables.

It seems the SCD-1 doesn't have a true balanced output, instead it is converted from the unbalanced one by some additional circuitry. At least this is what was discussed in AudioAsylum....

I am using the SCD-1 in an all balanced system (ARC LS25 to ARC VT100 MKII). The balanced mode (using Burmeister Silver interconnects with both XLR and RCA terminations for comparison) is clearly superior to the unbalanced mode, in my system. Presumably, the benefits of the balanced mode is dependent on whether or not your preamp and amps are fully balanced designs.

Correct, it's not a truly balanced design, like the earlier Xa7ES was. Hence the reason both sound the same (Bal. vs. unbal.) is that they are the same, derived via a chip (IC) that creates the inverted signal for the balanced connector.

There are a multitude of benefits, other than noise rejection, for components with a truly balanced signal path. Several companies design with this in mind, BAT being one of them.

FWIW,
-Ed