I'm always playing (something else) while I'm ripping - is that a bad idea? Of course, I want to get the whole collection ripped and boy that is going to take some time!
All,
I don't recommend playing music when ripping.
Here is another thing to note: I use FLAC encoding when ripping to my Olive's hard drive. Even after the CD is finished ripping and you eject it, you will still see the little blinking icon on the top of the screen that says it is busy doing "something." I believe this is the actual process of doing the FLAC encoding from the ripped files off the CD. So if you are playing music off the hard drive while it is ripping a CD that is in the drive as well as encoding FLAC files from the last CD you ripped, don't be surprised if the unit pauses while playing music and/or you get a glitch somewhere. I'm not sure the exact specs of the IBM powerPC processor and RAM used in the Olive, but I have found that it doesn't like to do too much multi-tasking

I have found that I get best results when I rip a CD and DO NOT play music at the same time, AND when I wait for the encoding process (that little blinking icon that I mentioned above) to disappear before loading the next CD into the machine to play or rip. YMMV.
Also, if the CD you are ripping has errors (scratches, dust, dirt, etc), it may or may not cause a problem when you play back off of the hard drive. I own some CDs that don't work in many other players (scratched) but seem to work fine when ripped to the Olive hard drive and played. I also burn them back onto a CD-R and they work fine

Hope this helps,
Vinnie