

It works incredibly well - I made a chest at spawn for discs, which is already about to overflow:

Feel free to take discs from spawn for your personal use. To make a jukebox to play them, lay out 8 wood planks on a crafting table as if making a chest, then put a diamond in the middle.
Want to try to farm your own discs? Here's a quick rundown of how to use this thing:
0.) Check that the skeleton tube is not turned off.
See below about this.
1.) Lure Creepers into the water trap.
This is the hardest step, and is the reason this thing can only work at night. Fortunately there's a lot of flatland around the farm, so Creepers shouldn't be too hard to lead. Just run out, get their attention, and get them into the water without letting them explode. Duck out of sight as soon as they reach the water, or they might follow you!
2.) Sit in the collection spot at the bottom of the ladder.
Go down the ladder in the little hut and sit in the collection spot. A skeleton from a nearby skele dungeon should be at the far end of the trench. (See below if it's not.) It will see you, start shooting, and hit the Creepers. The Creepers can't reach the skele due to the water and some fence posts, so don't worry about them blowing up the skeles.
3.) Profit and repeat!
Once all the Creepers are dead, nab their drops from the chest in front of you. Then repeat these steps to do it again!
One gotcha with this contraption is this thing:

A water ladder draws skeletons from the dungeon constantly, and they will pile up. This structure lets you kill the excess ones with the flip of a switch.

If there are no skeles in the machine, make sure this switch is flipped UP DOWN so they can get through. If there are too many (which will stop Creepers and other mobs from spawning), flip the switch DOWN UP to suffocate them. Keep it flipped down up, and the skeles backing up behind it will drown. [EDIT: I've redesigned this switch so it auto-activates the suffocation when a skele is in the machine. Flip the switch at the back to override it. The switch positions are now reversed from what they were before!] I kept the manual switch because flipping the switch to compress them into dust is incredibly satisfying...

That's about it! Just remember that Creepers are explodey! Please be careful/smart when wrangling them, and please repair any damages that occur! There are spare parts in the double-chest in the collection area.
Also, try not to put more than four Creepers in at once. They can push each other close enough to the skeles that I'm not 100% sure they won't explode. Try to collect discs from all the Creepers that are in the trap before adding more.
Have fun, and enjoy the music!