All good as you have it.

For best sound quality, make sure “Auto Ref Level” is active in ADI-2:
I/O / Line Output / Settings / Auto Ref Level: ON.

If correct, when you turn ADI-2’s volume dial, the volume figure shows dBr (instead of plain “dB”).

Correct!

It’s the output reference level that ADI-2 automatically adjust to the best fitting value.

Usually nothing goes wrong except user errors, same as with every amp.
ADI-2 itself has protections against electronic faults built in.

If, what I see in the picture you posted, is your normal volume, I suggest to use some passive attenuators to add protection against misuse and further improve level matching:
https://forum.rme-audio.de/viewtopic.ph … 42#p120442

https://www.amazon.de/MONACOR-Pegelmind … amp;sr=8-3

You would take more advantage of ADI-2’s dynamic range.

Due to the clever “Auto Ref Level” function ADI-2 keeps it’s dynamic range and SNR down to about this volume setting.

The other advantage of passive attenuators, already mentioned:
Better protection against user errors that lead to excessive loudness which endangers the speakers.

Volume 0 dB has the best Signal to Noise Ratio - SNR - and the highest resolution.

This is what Auto Ref Level does:

Keeping the internal digital volume as high as possible, while selecting the best fitting Reference Level for the desired listening level.
Auto Ref Level‘s calculation even takes level changes of ADI-2‘s DSP functions like PEQ into account.

No, too hot.
Dial back one step.

Your photo shows the Line Out.
For record level you need to watch the Analog Input.

Overs might have got “lost” if this is the playback signal from the recording soft.
Check this by doing a short recording while purposely overdriving the input, then play it back from your PC
Do you still see the meters show “OV”?
If not, the information is “lost”.