Well, I hope my answer isn't too basic.
Put it that way:
1. You can either buy your own industrial equipment that will press (CDs), Print covers and shrinkwrap your CDs (Just to give you an idea an industrial printer is about 200000.00 bucks).
2. Or you can simply find a company that does all that and pay 700-1200$ for 500 CDs.
But to keep things really simple, get a box of 20 blank CDs, Print your own covers and forget the shrinkwraps. See if they sell and if they do (provided you sell all of them) - Go with the second opption.
-ED-
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A gentleman is one who never hurts anyone's feelings unintentionally.
- - - Oscar Wilde