this is wrong at so many points.
first of all, music today is ABSOLUTELY still about the physical copy. sure you can download it, but unless you're downloading from iTunes (which you're apparently against, but we'll get to that), the quality is going to be much, much less than what the artist, producers, engineering, and mastering guys wanted it to be. aside from just that, it likely won't be the quality YOU want it to be. anything less than 24bit/44.1Hz starts to sound like garbage. when you load a 24bit/44.1Hz song to your computer, upload it to some site, download it, then burn it to a CD or put it into iTunes and load it to your iPod (or whatever), the amount of loss is just disgusting. and yes, people still use stereos- i have a $1,500 system sitting right in front of me with piles of CDs to play in it... i'd rather run my CDJ through it, though, but that's a different story.
as for your apparent beef with iTunes, i don't think you really get it. no matter where you buy music from, the retailer is going to be taking a substantial portion of the profits right off the bat. from there, the label, distributor, agent, producer, engineers, and attorneys get paid before the artist. no matter where you buy from- be it iTunes or a record store- the artist is seeing very little of that money. there ARE rare exceptions to that rule, usually involving self-produced and promoted artists, but for the most part, music sales through traditional retailers and online resources don't generate the artist nearly as much money as a fan would hope.
it's nice that you'll buy shirts and merch, but even that ends up only kicking the artist 25-40%. there's all kinds of overhead you don't even think about from paying the people selling it, to printing shirts, to paying security in the parking lot to bust counterfeiters.
if you want to show your true appreciation for the people who are a part of your life every day- which is ultimately what those artists are- prioritize your spending in such a way that you can show them support by helping them continue to make the music you love and put a roof over their heads and food on their table. sure, i download music, but once i decide the music is something i value more than a one-shot deal, i purchase the physical album and blast that shit at a MUCH better quality level than ANY downloadable site can offer.