A few thoughts:
There's no reason you should think that no one will hear your music. You can put it on YouTube, iTunes, here etc... there's a zillion opportunities for you to get your music heard, many free.
You don't need CD's to get your music heard. You need CD's if you have a gig where you can sell them or some other event/situation where you can sell them. Just making CD's and thinking you can sell them at a local store and mail order or something is not happening. People will buy them at gigs because it's a souvenir of the event.
Maybe the reason to do it is to develop your craft?
See, the thing is is I am beyond this stage. Developing my craft? I've been developing it for 17 years. I've been composing music for 9 years (not writing words and banging out chords, but actual composition). I have performed to varying audiences with various styles of music, some were competitions, most were not. I have shown the world for many years many of my midi compositions. People around the world have heard me.
I felt it was time to finally put it all in and make a commercial product, as I felt I was ready. I was finishing up with business school, I was confident in myself, and I had the capital to put several thousand into hiring musicians. I wanted to finally be compensated for those 17 years of hard ass work.
The problem is my primary instrument are the drums. You never hear of drumming-songwriters...mainly because most drummers are incapable of making anything resembling a song, but also because they can't perform the song for anybody, either a listening public or bandmates. And I suck at singing too, which means its a matter of handing out sheet music (which requires years of training to learn as well) or in terms of sharing with the band, banging out the chord progression on the piano (since I do play piano, but not very well anymore).
*I* need CD's because of what I did write....a continuous rock opera. While people *can* rip the CD's into computer audio files, that is fine and that is their right. However, that is not the way I want people to listen to this. If they listened to it on shuffle, songs will abruptly start and stop (where the track begins and ends) and the progression of the story would make no sense. It was an artistic decision to have the physical CD. I may end up being forced to do digital downloads in order to break-even, but at the risk of artistic integrity.
So in this economy and in this industry, I literally have every card and chip turned against me. It is hard, and I'm figuring out new ways of marketing myself everyday. But it is still damn hard.