New member here, but I'll go ahead and jump in the deep end of the pool!
First, let me say that I do not consider myself an audiophile. I believe a lot of things sold in high end audio are nothing more than snake oil and techno-babble.
That being said, I do think that their is a place for hi-res audio downloads. It's just a case where most people these days are unable to appreciate (aka detect) the added fidelity due to the way they consume music. In my experience, in order to appreciate hi-res (and I'll toss Redbook CD in there) some (or all) of the following criteria need to be met.
1) A relatively quiet listening environment.
2) A high quality audio system.
3) Properly mastered source material.
4) The type of music (genra) as an impact
5) The volume the material is being played
6) The focus of the listener
7) The integrity of the listeners hearing
It's all a matter of context with how the listener consumes their music. Hear me out.
I'm almost 50 years old, and my hearing is still excellent. My home stereo is pretty good, but definitely not boutique crazy. Anthem MRX300 HT receiver which doubles as my DAC, Rotel RB1080 amp which drives a pair of Klipsch chorus II speakers, a Vandersteen V2W subwoofer, a Martin Logon Grotti i Subwoofer. Everything connected with Blue Jeans cables.
When I'm commuting to work in my truck, I really can't tell the difference between 320Mbit MP3 files and Pandora. The resolution of my truck system combined with the noisy listening environment just doesn't allow me to differentiate the difference.
I also don't notice low-res/streaming if i'm at home entertaining a group of people, or walking around the house doing chores. I'm not engaged enough with the music to notice and/or care.
Poorly mastered source material is also an issue. Junk in=junk out at any resolution. For example, I've done blind A/B testing with Metallica's Death Magnetic and St. Anger albums. I am unable to tell the difference between a FLAC and 128Mbit MP3. On the other hand, I can tell the difference between a 256Mbit MP3 and FLAC if I'm listening to Diana Krall, or some other non brick walled source material that contains good dynamic range.
In my opinion, volume also has a huge impact on being able to detect the increased fidelity. Sitting in the "sweet spot" and listening at a decent volume vs walking around with the music at low background levels is huge in being able to appreciate the difference between low and hi resolution source material.
The "We" in "We don't need no stinking hi-rez" is probably 95% of people who consume music. So it's probably an accurate statement from a percentage standpoint. There are still a few of us out there that still enjoy turning out the lights and listening to an album front to back on a real stereo. We like the ability to listen to material at the highest fidelity possible.
