I spend quite a few hours each day driving and listening to music. The current setup is the stock Mazda CD stacker and speakers. The sound is not too good.

Would it be worth it to upgrade to better speakers and an mp3 cd player ? or is a car really limited acousticaly ?

Could be worth to upgrade speakers if your setup is missing some frequency range* or if you know they have crap frequency response (product knowledge/listening test).

(*) you can tell us:
- what is the power of the amplifier and its impedance ?
- what kind of speakers are installed and what its size ? e.g.: midrange, tweeters...

Cars are acousticaly limited at least in 3 aspects:
1) As you already know, custom technology speakers are packed in a box whose material and dimensions are designed to maximize the acoustic propagation. Mind you that cars often have speakers fixed in the panels without proper package. This isn´t good as inside the door we have irregular surfaces and unspecific materials.
2) The usual position of speakers are subject to be blocked by people or stuff.
3) Weak noise isolation from outside (including powertrain).

Of course, luxury segment vehicles take care of the first aspect and perform better at the third.
The second one could be solved by installing the speaker at the roof but small vehicles don´t have enought space for this. Maybe using thin speakers but I know nothing about them besides their high price.

About upgrading to an MP3 CD Player its your choice. Do you already have a portable MP3 Player ? If you do have, you can research if your CD Player has auxiliary inputs or you can try these FM transmitters

I've just upgraded the speakers and head unit in my ford EF falcon and I can definitely say it's worth doing. Depending on what speakers you get you can increase bass, treble, lower distortion basicly improve overall sound. But I would advise a lot of research before choosing speakers, because there are a lot of things you must consider.

I have a JVC KD-DV6108 in my car which plays mp3's off DVD. You can fit around 900+ songs on to one disc @ lame -V2. it is excellent for long drives, insert disc, set to shuffle and drive.

have you measured to find out what size speakers are in the car already?

There should be a standard to speaker size in cars around 6 inch or 6-1/2 inch. The problem is depending on the quality of the speaker they might have too much depth to fit in the door without getting in the way of where the windows winds down.

I like the idea of a DVD rather than CD, becuase I already have 6 cd stacker. I haven't got any specs or measurements yet though.

There is a slew of positive feedback regarding a pair of Polk Audio speakers (5-1/4 inch, I believe) that you can read at crutchfield.com. I concur that upgrading the speakers and/or head unit can definitely provide improvement, especially depending on the current quality of your speakers and the head unit's RMS rating.

Also, even when you've done all the research about speaker size/shape compatibility with the factory speaker wells and mounts, you can still find that the manufacturer has moved connectors/components around on the more recent revision of the same speaker model, causing a speaker model that once did fit to no longer fit.

(...he says, glaring at the Infinity car speakers that have been sitting on his shelf for over a year...)

-brendan

I think it's worth to do something in most cars, but you can also overdo it..
I know a lot of people that are pumping thousands of € in theire cars or simply put an amp and a subwoofer into it so that everyone 'hears' them from a km.

Many cars lack bass, but there's not always a need for amp and sub.
For my quite small car, two additional 9x12 inch (I believe) speakers (full range I think..) in the hat rack are sufficient.