It seems like it's all a big matter of degree, and the value placed on the differences is clearly a very subjective issue. In psychology, the area known as sensation and perception (psychophysics), some guys named Weber, Fechner and Thurstone (sorry, I have little memory of this subject) a loooong time ago created a scale that was referred to "just noticeable differences" to measure the relationship between stimulus and sensation (JND's; and man I'm going back 20 years to undergrad and grad school). Experimental psychologists had subjects listen to carefully calibrated stepped stimuli to accurately detect differences in auditory stimulation. This was really all about loudness though...http://www.ipsych.com/vis/scaling/scaling_desc.htmlhttp://pegasus.me.jhu.edu/~allisono/.../lecture14.pdf
I guess one of the key questions is just how much money/upgrades etc. to the source (vs. other parts of one's hi-fi system) does it take to create a JND, and how many JNDs does it take for one to say: "wow, now that is really much better sounding." And then, how much money does it come to those number of JNDs. For some, maybe just 1 or 2 JNDs are worth a lot of money, cos they have the money, it's a hobby, and they achieved a new height (kinda like an achievement akin to a sports competition). For others, it had better be many JNDs, cos that money is really scarce, and they really just kinda wanna make these upgrades once in a blue moon and then sit back and listen to the music (knowing that they have a really nice system) and then sorta fuhgetaboutit (the hobby).
Just some thoughts that basically say what has already been said about the subjectivity component (both in terms of auditory perception, which varies from individual to individual and in terms of perceived value, which also varies across indivduals).
I'm kinda in this soup right now as I am contemplating upgrading my source, which is 6-8 years old (depending on if you go by when it was built vs. how long I've had it), but pretty good (stereophile B; $1200 retail back in 1999). How much do I have to spend to get the "wow" factor? That is the question I ask myself and the retailers and modders to whom I have spoken.