I believe that the digital conversion, should take place as soon as possible and with the minimum amount of components, to maximize reliability, minimize thermal and electrical instability and reduce costs and environmental impact. And since our micro are not "asthmatic" (funny and appropriate adjective used by you in a few posts), and that we also have the enormous power of the PC, we can use simple strategies and convert directly into digital, the same oscillator.
Our simple technique eliminates the second oscillator, the hetherodyning mixer, the low pass filter, the audio signal, the DC amplifiers and the ADC.
For me a true Digital Theremin should't use hetherodyning and audio signal.
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On this link: www.thereminworld.com/Forums/T/29160/tell-us-about-your-experience-with-opentheremin
You posted: "They are heterodyning because the asthmatic Arduino can't handle fast precision timing, nor does it handle audio generation very well." So why still thinking using heterodyning, low pass filter and ADC?
I can not simulate your circuit, but I'm simulating the Open Theremin. I will tell you in more details later, but I have already identified some serious limitations:
1) The oscillators using the 4069 are extremely noisy, we used them before moving on to FET and we were never able to achieve a stable useful distance (over 30cm the noise becomes disproportionate and the note flutters)
2) The heterodyning and the Low Pass filter introduce delays and jitters.
3) Since, after all that transformations, the final measuring is a period, why not simply measuring the oscillator's period, as we do?
The schematic I'm referring to is: "Open Theremin ONE V1.2".