FLAC format will not play on standard CDP and DVDP. The files have to be burnt as an Audio CD and any burning software will do that (I would recommend Ashampoo Burning Studio, Version 6.75 is free and available on Download.com. I have personally not come across any CDP or DVDP that plays the FLAC format, but I do think such players would be available, but would cost a lot.
On the other hand, if you are d/l from the net, then a PC might be a better option to play FLAC files (at least I use my PC for my music) and here I would recommend XMPlay (a great player).
Based on my experience, the differences would range from 'not so much' to 'wow' based on how you listen to the music. If it's going to be from an MP3 player with the bundled earphones, MP3's should be OK, bit if you're going to listen to them on a really nice car stereo or a nice 2-ch rig, my choice would be: