heh. You are correct Andrew, the rpi will always have an SD card. But we only use it to bootstrap u-boot. The rest of the system starts by tftp'ing the kernel and nfs root mounting the FS the same way diskless MDs PXE boot within LinuxMCE, so this is very different than 'Installing your favourite OS and manually installing and configuring squeezelite'. Simple, no hassle, minimal config in webadmin (I'm working on eliminating this too), and no on-rpi configuration required. It is of course very fresh and minimally tested so far but the idea is to remove the manual manipulation and make things *much* easier for users.
We've found that the optimal solution is often a Rpi on Wifi behind an amplifier or speaker system. Raspian + Squeezelite is incredibly easy to install configure too and will provide a flexible solution.
We used to use pxe booted devices for this in the past though.