I had the Toshiba DVD player with Nuon. It also supported HDCD music. They were regular CDs that could be played in any CD player but in an HDCD device there and it supposedly sounded better. I never had any Nuon content but I did have a single HDCD disc and an extra light would show up when I played that.
"High-definition" audio for consumers is essentially a scam. The original 44.1khz/16bit redbook CD audio standard already exceeds the limits of human hearing.
While the gist of your argument is technically correct you are missing one important factor, amplification wether through solid state transistor or analog tubes, causes distortion. With 44.1 kHz all sine waves above 22 kHz cannot be reproduced which makes for some pretty unpleasant distortion harmonics if those wave forms are being fed through the wire without a filter on the output signal.
https://en.wikipedia.org/wiki/High_Definition_Compatible_Dig...