Beetlemania: I can only tell you about my own experience, I used to have QUITE an audio system. Now I keep only the speakers (got a Polk Audio Reference system), the amplifiers and Pre amps (Carver) and a DVD Player. My Audio comes from my PC, fan-less, an Asus mobo with soundmax codecs and a liquid cooling system.
I have now 500 GB + in audio files, some leftovers in mp3 but 99% in FLAC. Did quite a lot of testing comparing WMA, WV and FLAC (all lossless) and decided on flac because of compatibility and universality. I have quite good "ears" and can hear no difference between wav an flac, and with wav you cant tag.
As audiophiles say: you got to spend a 90% of your budget on speakers. Good speakers make ALL the difference.
BTW, I am ripping to digital a huge collection of cassettes (ya, cassettes
) and SVHS HiFi tapes from years ago. Lots of recorder music and some muisc that cant be found now. I Use Adobe Audition for recording and normalizing.
Of course: I have THREE external HD backups!!
Go On with it, you will have LOTS of FUN.