I did not find the battery life to be short at all. I have no hard data, but my overall notice was that it outlasted my other portables so far. I'll keep an eye on it, but I have rechargeables, although an inline recharge is best. My Sony D-555 is far worse, if that means anything.
There is no optical out. I've used Koss KSC-35, Eytomics (can't recall model number but first generation issued) Beyer DT990 and Sharp HP-MD33S headphones. I prefer the sound through all of them to the Sony D-555, Panasonic SL-MP77 and even my RCA RP2020 units. It compares well with my non-portable Wheatfield HA1! (Prudence dictates that I not proclaim it superior or conclusively "even" until I test over time.)
My tastes are classical and pop/rock. I don't have IPOD or any other alternate portable technologies except non-portable SACD, so I look to others to do those comparisons.
Perhaps the most surprising thing is that anyone put new effort into portable CD, when I thought the glory days were past. I am very happy with this machine and use it constantly.
The Panasonic SL-MP77 has unusally good headphones, well matched to its less-than-powerful amplifier, but in every other way (except MP3 playback), the Bose trounces it when it comes to powerful real-world playback through my can collection.