Well, it seems to have been fixed!!
At first I thought dbaxter was onto something since I am running on a laptop with windows 11 and the power settings were indeed on "Balanced".
But, after trying it there was no change in the behaviour of my program.
Next, I read up on the BASS_IsStarted documentation and there was something that stood out to me:
If the device has not been started, then 0 is returned. If the device has been started, then 1 is returned if it is currently active and 2 is returned if it is inactive (nothing is playing and BASS_CONFIG_DEV_NONSTOP is disabled).
So, just for laughs and giggles I implemented a BASS_SetConfig setting "BASS_CONFIG_DEV_NONSTOP" to "TRUE" and that seems to have been it!
I can happily keep a stream standing ready in the queue and as soon as I press "Play" the stream starts without delay! Happy times!
Since I am writing a play-out system for my radiostation, the delay really was a showstopper.
Thanks for all the help!