Pixel Magic sell such a device - the MB100. They also sell an audiophile version - the MB200.
I'm thinking about buying the MB200. I had a quick demo yesterday, comparing playback of .wav files with the original CD. The rest of the equipment used was an Arcam Solo, and Quad 11L speakers. As the music being played wasn't to my taste, all I can say is that there was very little difference between the two.
I'm going back next week for a proper demo, taking some CDs and.wavs of my own. I also hope to compare it to a more expensive CD player.
The Pixel Magic devices aren't cheap - £300 and £370.