100% agree, the sound of a lossless cd is unmatched.

Yes, I think the medium that you play your music on does actually matter, listening to the same music on a CD-player and an MP3-player does not sound the same at all to me. It is "thicker" in a way, it has a more luxurious sound.
Its the same with LPs, the sound is very different.

For example, I have Sepultura's 'Arise' album in all three formats - LP, CD and MP3.
And the best sound - to my ears - is on the CD, followed by LP, and lastly MP3.
This is despite them all being [probably] based on the same digital data.
The MP3 has a "flatter" sound, if that makes any sense.

Except for rare exceptions it's impossible to tell the difference between a 196kbps VBR LAME preset standard and a CD. People claiming otherwise haven't typically done a double blind and even those that have and can tell aren't going to be able to tell if they bump the quality up to the next setting.

It's the same group of people that claim that vinyl sounds better when what they really mean is that they're used to the sound of the degraded audio that comes off a turntable and aren't interested in the higher quality recordings that digital provides.