I have an
Engl 530 as well... the line level knob in the rear's the "master" output level for the whole preamp before its outputted to the poweramp; it also controls the volume level for the headphone out.
The premise is to have the power-amp at a suitable volume but not cranked while preamp at mid-level - you don't want the preamp signal clipping before it reaches the power amp stage

I have mine a little half-way before going in a Mesa 2:90
Reg