I'm really with you .... as I said, to me these toys, and that probably is a good word for them, are good for what they do, which is let you take several hours of reasonable quality music on the go without having to drag a CD player around. They serve that one purpose well. They're not designed to produce audophile quality sound. Although they're getting better. As I said, when I encode an MP3, I am very persnickety about it and do it just so, and I think I do OK as far as the quality. Although at a 128 to 192 variable bit rate, which is what I use, you can certainly tell that it's not CD audio.
People are working on it, though. I mentioned the compression codec called Ogg Vorbis which a lot of folks are excited about, supposedly you can get the fidelity of 192, 224, 256 bit rate MP3s at much lower bit rates (i.e., smaller files) with Ogg. The problem is, only a few machines support it right now because it takes more battery power to run it, and a selling point with a lot of folks who buy digital audio players is how long the battery will hold a charge.
Also, I've heard some rumblings through the grapevine, take it for what it's worth, that on official release CDs, the record companies are (a.) already compressing the files a lot more than they used to and (b.) are planning at some point down the road to outright go to MP3s.
Thats not good news about the cds being produced for worse sound quality, but with the putrid garbage that is being marketed today ,its probably an advantage! I really am in the "dark ages" when it comes to ipods...my advice is get the one with the BEST audio quality, that should be the priority...talk to ya soon, s