Quality system, make poor recordings sound better?


I notice that as I move up the audio chain, poor CD recordings sound worse and the good ones sound superb, should this be the case? Also I on any given day my system sounds different even with the same CDs. Any thoughts on this as well?
phd
there's some very good and interesting responses here but it would be nice if there were a few paragraph breaks for some of the longer ones
Katy lied by steely dan is a great example concerning this thread. I have always liked Steely dan and heard many times that album has problems. I just didnt understand until recently.

I upgraded my speakers, preamp and amp in a relatively short time frame finally moving to a class a amp and a great preamp from Pass. This album sounds a lot different and not better but worse. Mid range and voices too high compared to highs and bass. I thought, well maybe its just the areas that my system now emphasizes but after listening to about 100 other albums, i now recognize what others have said about this particular album. other Dan albums are just wonderful.

I can only come to the conclusion, the resolution of my system is now revealing the weakness or issues.
11-07-14: Metman
there's some very good and interesting responses here but it would be nice if there were a few paragraph breaks for some of the longer ones.

Some folks do like to Ramble On. ;^)
11-07-14: Rodman99999
The Dreamboat Annie masters were excellent. Nautilus did what I think was the best pressing of that album. Still my go-to for demoing Rock bass resolution(the synth & drum/Fender bass doubling on Magic Man)
How about the CD? I'll pick one up if also excellent.
11-07-14: Whart
Knight- Dreamboat Annie on Mushroom records, which I think is a KenDun master is actually a great sounding record.
I have most Heart but no Dreamboat Annie :-) There are hi-res releases now so quality has improved?? Concerts in Blu_Ray is very good.