OMFG. This is wrong. It seemed the "in" thing for audio geeks, circa 2001, was to start using XLR connectors to wire together their stereos... to get balanced signals. Or "balanced", because those heavy duty cords and connectors are supposed to deliver mono audio signals.
What makes them balanced, according to this article, is that two versions of the same signal are on the pair of wires. One has its polarity inverted. This is similar to twisted-pair ethernet cabling, or the old Appletalk RS-422 wiring -- two wires per signal. The pair resists noise because of what noise is: unwanted voltage. According to this other article, the noise voltage is picked up by both wires, lifting or dropping both signals equally. The amplifier at the other end is a differential amp, and doesn't see that interference.
What's so wrong? Well, if you put a pair of stereo signals into a single shielded cable, the two signals will interfere with each other. The performance, compared to regular cable, should be worse.
To improve the signal, they should have retained the RCA plugs, but used some kind of shielded cable, or even a coaxial cable, and wired each plug separately. Keep the lengths short, too.
Now that I feel superior to some "audiophiles", I have to confess that I'm a clueless noob to balanced audio. I'm faced with the difficult task of finding a device that converts consumer grade AUX outputs to pro balanced audio, by converting the signal and adjusting the level. It seemed like a simple problem of building the right cable... at first. Now, it's clearly a problem that requires some specialized equipment because it requires a good transformer, or an active circuit, to create the balance, and an amplifier to boost the level.
DIY? Nope. I just learned about dBu, dBV, and the difference between consumer audio and pro audio. I don't even know what the signal coming out of the device is.
Update: The best articles are at Jensen Transformers. They are extremely clear if you can read simple electronic schematics. Also, his article on Audio DesignLine clarifies things clearly (but it required some re-reading on my part to grasp what's going on).