Update:
Got myself a mini-stereo to Toslink cable and connected it to the headphone jack of my Macbook Pro. Downloaded several 24/96 albums off of HDTracks.com including 'Hotel 'California' and 'Paper Airplane'. Now we are talking!!! So far I have downloaded two players on the Mac that will play FLAC files; Pure Music and Decibel.
Both play the FLAC files at 24/96 and both sound great. Overall I like the Decibel software the best. It's has a simpler interface, doesn't require iTunes, and I think that it sounds better. And, it only costs $33. Pure Music is a bit more expensive at $129... According to the Decibel website the developer is working on upgrading the player to include playlists and other organizational features.