I made a very long post explaining some stuff but it was discarded for using to much [IMG] codes, also I just included 10 smileys: strange. Anyway, this is not the point.
First of all, I'm not an advanced audiophile, but just a regular listener with 2 ears and a brain which isn't afraid of reading some tech doc and having my own tests and related conclusions.
Before suggesting you to head to Hydrogenaudio Forum which is full of informations regarding all audio questions in general and audio compression in particular, I just want to say that IMHO, there isn't any definitive answer to those kind of questions appealing subjective points of view. Some purists even don't want to use equalisers in order to keep music intact, so don't talk to them about DSP
My opinion is to have the maximum pleasure when listening to music. If this is achieve by knowing that you have the perfect hardware and software, not changing a bit between the wave produced by the vibration of vocal cords of the singer and your ear drum, that's your choice.
As I have some poorly designed audio material (actually, all my audio material is cheap and crappy), I use some regular softwares without tweaking them to the max, although I know what to do in order to get the best quality. I'd rather prefer focus on having excellent good audio files. Thus I'm very concerned about ripping and encoding (EAC, plextools, lame to make it short).
I use winamp (default input plugin), vanilla eq, and some plugins stacked (DFX and Enhancer working together + some others, but fine tuned).
Now for the empirical observations (made short because I'm too lazy to restate what I wrote and was lost. If asked, I could do some efforts to repost :o ):
Some plugins and specially DFX seems to be designed to enhance what MP3 (and others) forget(s) (for providing good compression ratios). Then, there is a chance, most often with low bitrate files that DSPs enhance or better, recreate, derive music from existing audio information, thus inducing some nasty artifacts as ringing, echoing, reverberating, ...
After some extense tests, I can easily exhibit poorly encoded MP3 defects, especially with crappy hardware (like mine), and I can even explain why, so if you're really concerned about this, I will post another long reply: just tell me.
So IMHO, DSP: good ! After testing several one (even combined), I stick to DFX, Enhancer, WOW, AlienSound, QSound, and some others, in that order of preference (the first, the better) each offering interesting effects, and I suggest to start with them.
But please, please, test by yourself, and see if it gives you some gains.