The internal wire inside components does matter, but it is prohibitively expensive to use pure gold or silver wire in most components. That being said, you can have the wire inside some components upgraded by professional modders. I know of one person who had an amplifier rewired with pure silver wire and said the improvement was stunning. In fact, the improvement led him to question whether paying for megabuck interconnects was even worth it.
As for what the point of using interconnects is, I think they provide an invaluable way to tune your system. Some people say the best interconnects allow the purest signal transmission, and that they aren't tone controls. I think this is bogus. Every wire in your system is a tone control. Anyone who says differently should consider the concept of relativity and the fact no one really *knows* what a component is supposed to sound like. The only way you can listen to any component is with cables, and they all color the sound in their own way. Changing interconnects allows you to color the sound the way you like it.
Tomer
