Does anyone remember what the first dos program was that did digital extraction from cdrom drives. Was it l3enc?

L3enc is not a digital extractor. L3enc is the Fraunhofer encoder software. Odds are a different program was used to extract the digital audio, and then it was passed as individual WAV files to the Fraunhofer command-line encoder in your case.

I don't recall there ever being a DOS program that did DAE. At least not a common/popular one. By the time MP3 came around, there was already lots of Windows software to perform DAE for the purpose of audio CD copying (for instance, Adaptec Ez CD Creator did this just fine). What most people did was a two-stage thing, pulling the CD audio tracks with one piece of software, and then encoding with another.