A year ago, I posted a very similar question to this newsgroup, and the answers I got (which you can find through a Google search) were very helpful. Here are some of my own comments:
Two Berlin CD stores stand out:
Kulturkaufhaus Dussman on Friedrichstrasse 90, near Unter den Linden (between Brandenburger Tor and Staatsoper), in the former East Berlin, close to The Komische Oper, Staatsoper unter den Linden, and the Konzerthaus, and also not that far from the Philharmonie. Great selection, prices tend to be towards the high end, but, again, great selection - a store comparable to (or better than) the best in London. The classical department is in the basement, but also watch for inexpensive specials on the main floor. They are open late (very late by German standards, 10 pm). They have a website:
www.kulturkaufhaus.de
L&P Classics, Knesebeckstrasse 33/34, Corner Mommsenstrasse, one block from Kurfürstendamm (in the former West Berlin, not far from Deutsche Oper). This is something you will not find in, say, the US: An independent store with a very deep selection, well educated, polite staff, who treats their CDs as something more than just a flat box of plastics. I know from experience that they close early (6-ish).
L&P is not far from Zweitausendeins on Kantstrasse 41/42, away from Kurfürstendamm, the large low-price chain. They have a very limited selection, but what they have, they sell extremely inexpensively - the Brilliant boxes were less than 2/3 of the price at Dussman. Small store, can be very crowded, no credit cards, but very well worth a visit. Their inventory is listed on their website,
www.zweitausendeins.de
If instead you walk back towards Kurfürstendamm from L&P, you will see 'Promarkt', a big chain, similar in concept to the US Best Buy, but much better. Smaller selection than L&P, but good prices, and nothing to scorn.
Back over in the East, at Alexanderplatz, you will find Saturn, another big electronics-refrigerator-music store, not as good as L&P or Dussman, but worthwhile (= I spent too much money there). When I visited, they had a lot of (formerly East German) Eterna releases, reissued on CD at extremely reasonable prices - I bought Bach cantatats with Peter Schreier for $2 each, hard to beat.
There are also a few second hand stores, but I did not find them worthwhile. Selection was limited, and the prices, compared to the US stores I frequent, were high.
There was a time when buying CDs in Germany was finacial suicide, at least for a US based traveler. Things have really changed! Yes, many full price CDs are still more expensive than in the US, but I was amazed at the number of very reasonably priced budget and midprice releases, and a number of 'specials' I have not seen in the US. When I visited, Naxos was still $5 a pop etc etc
Where Berlin really shines, though, is in the easy and inexpensive access to live music. There are three opera houses, and the top price (aside from first performances etc) seemed to be 50 euros or so, which at the MET barely gives you access to the men's room. People go, and people from all claases of life go. Sometimes coordination between opera house is a bit weak: I saw two Magic Flutes, and I would probably have been able to score a trifecta, if Barenboim had not decided to do a Wagner festival at the Staatsoper (the 10 mature operas, all performed twice) when I visited. Orchestral concerts were also marvelous: I usually showed up half an houir before a performance and could buy a ticket, either from the box office or from another concert goer. I heard Rattle do French music with the Philharmonic, Barenboim do Brahms with the Staatskapelle, Weller do Bruckner with the Berlin Symphony, and yet two orchestras were out of town during the 2+ weeks I was there. Simply marvelous, and accessible.
