I'd observe that "CD quality" can mean a number of different things... I'd say all of my three computer music systems are "CD quality", but one is head and shoulders above the others...
Anyway, the route I chose was the Waveterminal U24. I chose it because:
1. If you are serious about music, you should really think about an external DAC anyway. This allows up that flexibility. I started with a Stereolink box, but the sound I got from a Sonica and a cheap DAC was better. Way better. I personally think the U24 sounds better than the Sonica/Theatre or my prior standard, the Edirol UA-1D. The reason might be that those devices purportedly resample to 48 kHz rather than the native 44.1. Who knows, and others have gotten good results with modded Sonicas/Transits.
2. Inside a computer box strikes me as a seriously poor environment do to DAC processing or reclocking; very noisy, lots of RF.
3. The U24 is USB, so I can use a long USB run (I use a repeater cable in one application) without introducing lots of jitter. I tried long coax or toslink runs, but the sound was... well, *smeared*. Muted. Ugly.
I have yet to have any driver issues with the U24, and it works flawlessly in both my Mac and XP Pro environments. I have *not* used the U24's DAC section. But, that might be a cheap way to go for you that would avoid the expense of an outboard DAC.
Because its USB, you can skip the upgraded sound card. Frankly, given the resolution of most handheld/touchscreen devices, you can probably forego the upgraded video card as well. On that side, I'll give you a couple options...
The music server part of my main rig is a mac Mini--has a built in DVI output that interfaces nicely with my Pioneer plasma. Also bought it with bluetooth, so I can run the whole shebang from the couch with a wireless keyboard/mouse (I really wish someone made a halfway decent bluetooth trackball). You can (although I haven't) also get a range of IR remotes that can be used to control iTunes.
In a prior incarnation of my system, I was running everything off a 10" Viewsonic touchpanel. The touchpanel acted as a remote desktop for a remote server, connecting via 802.11b. I then hooked up a serial port server by Moxi to the LAN near my rig, which allowed me to hook up a Slink-E IR controller to all my gear. I ran Mario Cascio's Cinemar software on the server, which made creating buttons/etc very easy. Given the problems with Slink-E programming, however, I'm not sure I'd advise going that particular route. Expensive and non-standardized.
Last thought I'd leave you with... If you are serious about the tunes and the investment of time to rip your CDs, don't use lossy compression like mp3. My files are all native .wav files. I started with "high grade" mp3s, but ultimately re-ripped everyone because I was dissatisfied. Trust me on this one... Do it once and do it right. Disk space is cheap.
Also, goes without saying, but back up your drives. I've had bad luck with external drives destroying themselves.
I'd also second the vote for EAC.
