What your doing works but is usually limited by the limited fidelity of most desktop sound cards.
For CDs, I would also recommend the increasingly popular USB DAC approach for best sound.
For certain networked music servers and internet sources (radio stations, etc.), A Roku Soundbridge with an Audioquest G-Snake mini phono to dual RCA interconnect and a broadband internet connection will take you close to the limit there in sound quality. The G-Snake alone could be a relatively inexpensive cable upgrade for your current approach as well that might help to some lesser extent.
For CDs, I would also recommend the increasingly popular USB DAC approach for best sound.
For certain networked music servers and internet sources (radio stations, etc.), A Roku Soundbridge with an Audioquest G-Snake mini phono to dual RCA interconnect and a broadband internet connection will take you close to the limit there in sound quality. The G-Snake alone could be a relatively inexpensive cable upgrade for your current approach as well that might help to some lesser extent.