Basically, the two formats kick butt. Both offer a greater sound quality than CD – and yes, you can hear a difference. If that isn’t reason enough to expand your musical horizons, a fair amount of the titles come in a multi-channel format as well (read: 6 signals for 6 speakers). My favorite so far is Pink Floyd’s Dark Side of the Moon SACD. They did an excellent job of separating the music across all channels. The opening of "Money" is money – the cash register sounds revolve around and around the listener, creating a wow-effect the first time you hear it.
I'm really disappointed that the audio industry never marketed these formats. And it's not like they stemmed from companies that only audiophiles have heard of. SACD was co-developed by Sony and Philips. DVD-Audio was created by a consortium of other big-name players in the consumer electronics world. It's too bad the two groups couldn’t come to agreement. I think having competing formats has hurt the evolution of multi-channel music more than it helped.
I won't try to go into the details of SACD and DVD-Audio (bit rates and sampling frequencies) -- I would probably bore you to the point you’d never read my rantings again (if I haven’t done so already).
Instead, I leave you with a quote from a magazine that my brother sent me that sum things up quite well. So in the words of LeVar from Reading Rainbow, "You don't have to take my word for it":
It is hard to explain the subjective difference between the sound produced by SACD and DVD-Audio and the sound produced by a CD. Essentially, trying to reproduce music with a CD is like trying to reproduce cool seaside air with the dry brittle air blowing out of an air-conditioning nozzle in a jet airplane and a spray bottle of salt water. In a very literal sense, the CD format is like playing a violin with a hack saw -- there is simply no way to smooth out the saw teeth sufficiently to make it sound correct. SACD and DVD-Audio fix the problem by giving you enough data to filter out the audible errors created by digitizing analog sound.