I own 2 squeezebox classics, and they are fantastic. They are especially good when using iPeng on my iPod touch as the remore control rather than the infrared remotes that came with them.
The sound quality is great as the squeezebox comes with a decent DAC in it. I read a review somewhere that said the sound was comparable to a mid range CD player (mid range in the particular article being about £300).
Might be worth hanging on for a little while though as the Squeezebox Touch is due to launch soon which has a touchscreen and also has a mini version of Squeezecenter running on it so you can just plug in an external harddrive containing all your music instead of having to have Squeezecenter running somewhere on your network on a PC or a NAS (I've got it running on a QNAP TS109 NAS which works well for streaming music, although it can be a bit slow for other tasks).
The SB classic can be connected to your amp either by RCA, Digital Coax, or Optical, Mine are connected by the RCA sockets and sound fantastic.
I'd definitely recommend them, but be aware that a little networking know how is needed when performing the inital setup. And that you do need a decent wireless signal if you're not using Ethernet cable to connect it.