ok I once did a test with this, for example i decoded an downloaded 96kbps mp3 file to wav and then reencoded it to 160kbps, suprisingly the sound did improve!
realistically most of my mp3s are 128kbps encoded and they sound great with just the ordinary stereo hooked up to the sound card, i would not waste my cash on a surround sound system just to play music. surround sound was designed for cinemas and slowly it came to our homes, but what I am saying is that unless u are planning to play dvds and movies on the comp there is no point in investing into a surround sound amp, I just mentioned it cause when I did have my surround sound amp back in the UK and a 64bit sound card the sound was ****ing amazing but also u got to remember that i had two majorly big speakers and two background speakers hooked up to the amp.
its all a matter of playing around with synthezisers (im sure u dont spell it that way). i suggest hook up ur stereo to the sound card with aux cables(im sure u knew that) and then disable the suntheziser on the mp3 player but use the one that is built into the stereo, most new stereos are lame and dont let u change **** but the bass and treble but the sound will still be fantastic.
for example i have a mp3 cd player with headphones on that thing is ****ing crazy amazing **** ma bitch up the *** sound!
all at 128kbps!
thats all folks and i think the original answer has been answered and if not - here it comes.
u need to write ur mp3 cds as data cds and not use the stupid wizard it sux!
i always suggest using nero burning rom, its very good with all types of cds, and the wizard will ask u what u want to exactely do when selecting the audio cd option