PCM isn't "a legacy format". It's the stream of data as it exists right before hitting the DAC.
What I'm saying is you want something like what you describe as "hacked pandora" to get the bits before decoding.
Otherwise you're doing the audio equivalent of JPEG -> BMP -> JPEG (to make a visual metaphor).
Alternatively simply play through a digital audio output and capture it that way.
You have no way of knowing what the data's original quality is at, and its introducing artifacts from analog output back into a digital form, which is then outputted to analog again. Its an option, sure, but its like saying "get all your music on youtube."
But as pointed out Audio Hijack does the same thing virtually with a kernel extension.
>and AirPlay is unencrypted ALAC.
That won't last. And with the removal of the headphone jack, we lose our last analog (and unencrypted) path for capturing audio.