CDs are going to have better quality than any digital form except for the lossless formats such as FLAC. Initially, iTunes music as DRM locked and at 128kbit/s, but a couple of years ago they finally removed all DRM and offered everything at 256k. Amazon is also at 256k and DRM free. I'm not sure where you can buy lossless music digitally, but I'm sure there are plenty of places.
Personally, I could tell the difference between 128 and 256k, but my hearing isn't good enough to tell the difference between 256k and higher rips.