Sorry to disagree, but no, you can't have hundreds of CDs on your computer, and also I'm not sure why you would want to.
What people do is to convert their CDs from WAV format, which is what is on the CD, to MP3 format.
A 6 min song in WAV will be about 63 MB. If you start to store these on your computer you will very soon fill up the hard disk, unless you have one of the newer very large disks. If your HD is 40 GB: it is likely to be used up by half with programs and Operating System, leaving about 20 Gb, which will allow you to store about 20 CDs and still leave enough room for other necessary stuff.
The same song in MP3 will be 14 MB for ultra high quality, and much much smaller as you reduced the quality - MP3s have a variable quality, which you most likely won't know unless you encode your own. With MP3s you can have hundreds of CDs on your computer.
Contrary to popular opinion, MP3s are very inferior in sound quality. However, if you listen on crappy speakers, or listen while you do other things, you would never notice the difference. (But your brain does, and there's the rub)
I think I gave you Nero Vicki, so with that you can put a CD into your slot, and Nero will automatically convert the songs to MP3 for you as you load them to your computer - in fact that is likely the default setting. Unfortunately Nero usually comes without it's help files.
Now, it is much better to listen to music on your stereo - the sound is far superior. What people do is to share music over the internet, and that is done in MP3 format. So you download music from various places - friends or sites where these music files are available - and then you store them on your computer in MP3 format, and listen to them there. You can then burn these songs to CD, but you first have to check if your CD player in our stereo can play MP3s - most can't, but many newer cheaper CD players can now.
Otherwise, I recommend you convert the music back into WAV format before burning to CD - it's not as good as the original WAV format the music was released in, but is still better than MP3.
I never store CDs on my computer unless I am to put together a compilation or I am working on them for some reason.
Simple.
Other matters - I fear to say it but you may as well forget about Winamp. I know this means MS wins again, but convenience wins out again.
Earphones. Go to Start > Control Panel > Sound. Check the volume for earphones is not off. Then ensure you have your earphones in the right hole - not the speaker hole.
Burning - if you have Nero installed - use Nero Express - you will find it somewhere in the Nero shortcuts. Otherwise you should read the help files to know how to use XP's own burning method - I never do so I can't recall exactly how to do it.
If you burn a CD with WAV format files, even if it sounds crapy on your computer speakers, it will be perfect on your stereo.
Now, how do you know you have a WAV or an MP3 format? Microsoft by default will most likely hide the extension (.wav or .mp3) so you won't know. Open a folder window, like My Documents. then Click on Tools > Folder Options. Click the View tab. About 10 items down you wil see "Hide extensions for known file types". Uncheck this, click 'Apply at the bottom, then click "Apply to all folders" button at the top - then click OK out of the whole area. Then you will see the .wav and .mp3 extensions on your file names. plus all the others - MS is always telling you what you want. They are insane.