Tim, you've almost described my setup to a T. The only thing I'm missing is Ammara, but I'm also not interested in hi-rez files at this time.
The only "difficult" part was organization, and that was predominately because my iTunes library was a mess. I had my own files ripped at 256k AAC for work, together with a mishmash of other tracks that I had acquired from friends/family in a variety of lossy formats. There were duplicates, corrupted files, etc. that had to be sorted through.
I ripped all of my CD library (roughly 500) in ALAC. I would rip the discs while I watched TV at night. It took less than 3 weeks total. I've kept some of the better lossy files for music that is difficult to replace and for which I didn't have a physical disc.
I took the time to redo some naming, genres, composers, and other issues so that the library would be sorted the way I prefer it. For example, instead of having "The Wall [Disc 1]" and "The Wall [Disc 2]", I just have "The Wall" and the metadata handles the division of the tracks into separate discs. The advantage is that it shows up as a single album, and will automatically play through both discs.
The end result is that I have thousands of songs available at the touch of a finger. Most of my CDs have been boxed and stored. So far I've run into exactly two tracks that needed to be re-ripped due to skips/errors, and that is very easily done.
Currently the library resides on my Mac Mini, which is upstairs from my stereo. I control iTunes using an iPad. iTunes outputs wirelessly to an AppleTV that is attached to a Schiit DAC. When I buy a new desktop computer, I'll move the Mac Mini downstairs and cut out the AppleTV.
Nothing that I have done was complicated, and very easy to set up.
I will continue to buy CDs because I like having a physical copy of the music. And I will buy another CD player eventually, since it's the most convenient way to play visitors' CDs on my system. But the computer-based system will always be my main method of listening.