HDTracks probably have the largest available selection on the net today but there are many other places that also sell flac.
To play flac on iPhone you need an app like flacplayer.
Technically the same cd encoded to flac and alac should produce the same sound when played back since both formats are lossless but it does seem that both file format and playback software can make a difference to the sound
Yes, currently checking FLAC Player & Golden Ear.
Looks like FLAC Player supports 24bit/96KHz but down converts to 16bit/48KHz.
Golden Ear supports 24bit/96KHz but I don't know if it down converts... sent a mail to developer to check on this....
Yes, that makes sense.... maybe the playback software was different... hence the difference.
It's not the apps that down converts but the iOs core rendering engine. The only way to get higher than 16/48 out of an iOs device is an iPad with camera connection kit and a supported usb dac