If you use a "Y-cable", you certainly have some resolution loss comnpared with an audiophile set-up. As for volume limitation, you shouldn't have less volume than what you can comfortably listen to. You can also buy audiophile grade sound cards as an upgrade to your computer; however, I think a Squeezebox would be an economically better option than spending what a good sound card costs, and it would be more versatile.