I think audiophiles who can't stand mp3s are a pretty minuscule part of the pirating population and not much to hang your argument on. The vast majority of people who are pirating music and movies just don't want to pay for it.
Yup, and they wouldn't have bought it anyway. Someone not buying your shit and someone stealing your shit both get you $0.
(I mostly buy CDs these days because of the lossless issue. But if I'd have to import the disc from another country, I just torrent it, because fuck paying $30 for a CD.
And yes, I know that 44kHz is not "lossless". So that's fine, let me buy 24-bit 192kHz files instead!)