my opinion used to be different.
i'm listening to the Tilson Thomas-SF Symphony Mahler 5th right now, in 24-96 PCM off my hard drive through the MSB Select II/SGM server right now. on the 5th Movement. had the lights down and was kicking back for the first 4 movements. I'm no Mahler expert or even Classical expert (so no flames about the Tilson Thomas version sucking ).
it's been involving and a satisfying musical experience and kept my attention.
nothing flat or lacking nuance or micro-dynamics about this. lots of action and great separation, space, realism and authority. I listen to lots of classical on the Select II. the Select II and SGM server are both pretty top level kit.
Friday night I had a few serious analog focused guys over and we listened to quite a bit of digital; mostly string quartets, and classical piano. they were quite amazed at the natural, spacious and focused presentation. one of them is a classical composer and music professor. he was especially taken with a redbook Haydn String Quartet and the sound staging and natural tone.
can Lps still be better? sure they can but not by as much as you might think.......but don't blame the digital format for the apparent significant difference between cd and lp, it's the particular digital playback systems that are lacking. my vinyl playback is up there in the higher realm too......but still the digital gets closer.
at the top of the playback food chain, top level digital/redbook/CD's can get fairly close to top level vinyl.......but below that it's a crap shoot. I would say a more modest vinyl investment will generally take you quite a bit farther than a similar digital investment, but there are no real hard and fast rules for it. there are giant killer vinyl set-ups with perfect set up, and giant killer digital too......that flip things around. and then there is always the issue of personal preference.