The first system I noticed the difference between AIFF and ALAC (compressed lossless) was with an iPhone 3GS docked to my car's Alpine Head Unit. Not even a very expensive set up. I used the Alpine's integrated amps and a set of Rainbow component speakers.
I had done that experiment after how I noticed a CD played on an Ayon CD5S sounded a lot more dynamic and punchy vs the same CD played on my iPhone docked to a Wadia iTransport and my friend asked to change it to WAV or AIFF. I thought he was pulling my leg but did it just as a test.
After the experience with the car system, I brought the phone back to the showroom where I had tested the ALAC vs CD earlier and this time, the gap was much smaller.
I had done that experiment after how I noticed a CD played on an Ayon CD5S sounded a lot more dynamic and punchy vs the same CD played on my iPhone docked to a Wadia iTransport and my friend asked to change it to WAV or AIFF. I thought he was pulling my leg but did it just as a test.
After the experience with the car system, I brought the phone back to the showroom where I had tested the ALAC vs CD earlier and this time, the gap was much smaller.

