For the most part, Ked has it right. There are many of us who have been at this for years and who have heard our systems with all levels of cables, both inexpensive and costly. Some experienced users like the great Karmeli and Ki Choi think expensive cables are basically a waste of money. When you hear their systems, you can understand why they believe this is true. Personally, I think you have to make the distinction between speaker cables and interconnect cables. Speaker cables are driving something with a very different impedance than the output amplifiers they are connected to, and as such, the differences between cables can be appreciably different since the cables are critical impedance matching devices where small changes in reactive impedance can have significant sonic effects. IMHO, these differences are generally greater than those found between interconnects. In fact, I have had some incredibly inexpensive interconnects outperform some uber expensive interconnects in some, but not all ways. My guess is that some of these differences might be due to differences in the terminations (i.e gold vs rhodium), and not just in the wire. For example, you might just be very surprised at just how good Mogami 2549 interconnects are with Neutrik gold connectors. You would think that for about $40 they wouldn't be worth a damn. Is it the best interconnect I have ever heard? No, but it is neutral, balanced, musical and damn good. So my question to most folks would be, do you think you have a system where spending far more on interconnects would result in a significant sonic upgrade?
It's worth remembering is that even though there may be differences between interconnects and speaker cables, my guess is that these are relatively small with respect to other factors in one's system, particularly speakers. So if you are looking to spend money to make big effect changes in in your sound, you really have to convince yourself that "cables" are the thing to change as opposed to speakers, or in some cases electronics (ie. SS vs tubes).
Yes. Interconnects are key and very few copper cables are capable of maintaining fine detail in the signal. There are some, but they are usually very expensive and UPOCC silver is still a good bit better as far as preserving resolution. It can make a massive difference in a system that is ready for it. It can make the difference between your room disappearing and you being enveloped in the recording venue or simply hearing a performance in your listening room.
As far as speaker cables, there is a lot more variability because the conditions they operate in are much more variable vs ICs. If you have a system with basic copper ICs and speakers with a moderately complex crossover using cheap parts SCs won't matter nearly as much and good ones are mostly a waste of money. OTOH, with a nice system with good ICs, low noise, and a very high quality crossover, speaker cables can make a big difference.
In terms of preserving fidelity, you don't lose as much going with less expensive copper SCs vs ICs. If you compare ICs and SCs made using the exact same wire you get a feel for it... in general ICs make 2-3x the difference vs SCs. My system can still produce a 3-D enveloping soundstage with my UPOCC copper cables while using the same wire in ICs smooths out a good bit more detail vs UPOCC silver or my silver/gold alloy. The music is less engaging when using copper ICs, soundstage collapses, it's just much more ordinary sounding.
So, I guess it depends on your expectations for a system. Personally, without the right IC cables (and clean, low-noise, unrestricted AC power delivery) I feel you'll never get a superior result. AC power and cables are the backbone of a system yet are often the last to get addressed, seems backwards to me. Once you can actually hear what your gear is capable of you'll be able to make better choices.
OTOH, some don't care about the kind of resolution and presentation I do, which is also fine. Some prefer warm, smooth copper cables and an undefined amorphous soundstage. That's fine too, and you certainly don't need more than Mogami to achieve it. Kind of like my TV. I got a middle of the line tv that looks great if not quite as accurate as the top models. I just don't care, it looks nice and it's more than good enough, it's even better with some material than the most accurate sets.