Per the CD ripping. I have no experience with AAC so I can't yay or nay kcarlile's post. Though, he tends to know what he is talking about. I personally use a program called Exact Audio Copy with the LAME encoder (both free) to do VBR (variable bit rate) MP3 encoding of my CDs. ARS Technica has a handy (and I think readable)
guide on doing this. But, again K is correct, iTunes is free and will be easier to use than the setup I just suggested. Less configuring and downloading.
just more food for thought.
-jr