If 128 for MP3 or WMA is said to be CD quality, what would the point be to convert them at a higher bit rate?

That is market-speak BS. No lossy encoding scheme is CD quality, and certainly not 128.

can you actually hear the difference?

Yes.

Depends on the material, but yes, certain songs at 128 CBR MP3, I can tell it's a lossy-encoded version. I can hear the "watery" artifacts around the instruments. Once you know what to listen for, it's not hard. Push it up to 160 or higher, and I can't tell any more.

I've been re-doing everything at 256 CBR lately, since now I have the disk space.