music server virgin needs answers

OK ... So I see in the new issue of Absolute Sound where some new USB music server gets a VERY high reccomendation. It's only $75 so I think this may be a fun thing to play around with ... but then I stop and think this: My son's Ipod has a LOT of great music on it, but I'm sure it's just stuff downloaded from either redbook CDs or off the internet.
So, since his original sources were not top notch audiophile sources, won't the quality of sound be limited to the atandard of the original source ? Anotherway of putting my question is this ... Would great sound only be obtained if the original downloaded source was of some form of super lossless quality stuff off some specialty website ? Thanks for setting me straight.
So when you rip songs from a cd onto your computer, then download them onto an ipod, how do you know if you have used lossless files in this process ?
Tim - the ripping software usually offers you some choice as to the kind of file you want to create (e.g., .wav, .flac, etc.). Be sure to research ripping software to find the right choice. Also, keep in mind that .wav files are usually not recommended for wireless transmission (by Sonos, for example).
There are websites that offer high quality downloads, but for the money you are better off buying the cd and ripping it yourself. EAC (exact audio copy) is one of the more popular and respected ripping software and it's free.

DB Poweramp is also worth looking into. It will give you the detailed properties of each music file and tell you the quality of the encoding. IT will also do batch encoding should you want to encode lossless files to compressed files for portable use. They offer a free trial.

Now please tell me, who makes the $75 music server? ;)