I get that you'll not use Pandora, but I am most curious to know what the breakeven point is for you on bitrate? Or are you fully analog? If not, what gear, what combo of digital and analog?
Other than radio, all of my music is sourced through media player or Itunes. I have slowly been converting all of my ripped content to my itunes library so I can simply use my wifi ipod to play it anywhere I want. I almost certanily see an iPad or other tablet taking that role in the near future. Having the touch screen library is just too convenient. The media-share on the DVRs woud be great for this too, but it's just too prone to lock-up and other random issues to be useful.
As for quality, the break-even point is whatever bitrate it takes to allow for no perceptible loss in the music's detail. I've not really tried anything lower, but 128k files sound fine to me. But what I can't tolerate is the hollow sound and loss of detail when using the on-line services and even many of the XM stations (freakin' Boneyard is the worst). When listening for an hour or more, there are also almost always intermmittent stops and studders that I can't get past either. They always seem to happen during the best parts.