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To help me set up Kodi with add-ons, network shares, favorites etc. I had attached a mouse to my Pi. I was also using the mouse to start Kodi from the max2play desktop. Doing it this way caused Squeezelite and Kodi to run concurrently, with the result that I had the problems reported above.
When I started Kodi from the m2p gui, squeezelite stopped and the hifiberry appeared in my Kodi audio output options, and everything worked as it should do.