Speculation On a Lossless iTunes Store
DrJenny writes "C|net UK has up an interesting blog post predicting that within 12 months Apple's iTunes Store will include a download center for lossless audio. This would be a massively positive move for people who spend thousands of dollars on hi-fi gear, but refuse to give money to stores that only offer compressed music — they could finally take advantage of legal digital downloads. The article goes into details on how Apple's home-grown ALAC lossless encoding relates to FLAC, DRM, and the iPod ecosystem."
I'm completely with you on the "nobody but the freakier people are going to notice", and they'll probably have gold-plated, gold-cable, etc. SACD players. Or, if they're really serious, they do away with the gold plating and have a goldsmith permanently goldsolder the wires right onto the board.
That said... the sampling frequency shouldn't be mixed with the signal frequency in the way you mention; e.g. 44.1KHz, divide by 2 (yay Nyquist), ~22KHz is the maximum frequency you can sample. ergo: 96KHz allows you to sample 48KHz signals and nobody can hear 48KHz anyway so what's the point.
Ah, true, but...
A 400Hz sine wave is now -also- sampled at the 96KHz level. Suddenly, that sine wave is looking twice as smooth.
Think of it like computer graphics. If you have a 320x240 15" display (12" by 9", non-widescreen 4:3), your pixel is going to be nearly 1mm on each side (12*25.4 / 320). A 1600x1200 display will have a pixel that is going to be much smaller, about 1/5th of a mm on each side (12*25.4 / 1600). Now you might not often find any reason to display a dot that is 1/5th of a millimeter at each side. However, if you were to display a large circle on the 320x240 display, it will be blocky. Do so on the 1600x1200 display, and it will appear to be much smoother.
Alternatively, find a piece of music that doesn't seem to do much over 22KHz, and band-limit it so that everything over 22KHz gets cut off anyway. Save this for later playback. Now actually downsample that to 22KHz. Now play back both files; see if you can tell the difference. Again, any high tones over 22KHz are gone anyway, so all you're hearing is the loss in fidelity of the lower-frequency ( 22KHz) signal.