I added a high level to low level adapter on my Super Nova years ago for the JAMMA speaker output (what Radio shack was selling about a decade ago).
When connecting CPS2/3 games, I connect directly from the RCA outputs to the RCA inputs of my stereo preamp. I set the volume on the CPS2/3 to max to get the right level output. I have had NO problems with this configuration.
Perhaps some people on the internets debate the audio output on those boards since there is volume control, making it not a "true" line level output???
While the outputs from CPS2/3 are not "fixed" line level outputs, there should be absolutely no problem using them as such. I certainly wouldn't use the high to low/line level converter when playing CPS2/3 boards.
The Neo Geo MVS boards with headphone output present the same situation. However, I use the headphone output on my one slot for line level audio (setting the corresponding volume slider to max). Same deal, no problems.
Hope that helps.