My home stereo system consists of the following elements:

1. Macinstosh G3 laptop computer – a 5 year old (?) 400 Mhz Pismo running the latest iTunes software and sending the tunes out via a PCMCIA card that handles 802.11G Wi-Fi. You can pick up one of these PowerBooks used for $400-600.
2. LaCie 250 GB FireWire drive – silent/fan-less – containing around 7,000 songs at present time – ripped as Apple Lossless or AAC 224kbps files. Figure on paying around a buck per GB storage.
3. Apple AirPort Express Wi-Fi installed near each of three stereos in the house
4. The AirPort Express near my main stereo is plugged into the Digital input of an old Parasound D/A converter belonging to a CD player I don’t use much anymore. Choose any D/A converter based on your ears and your pocketbook. This part of the set-up will vary the most in price. You could use the AirPort Express’s built-in D/A converter, and I do that for the other two stereos, but they certainly won’t be as good as a dedicated converter.