Absolutely this. mp3s wreak havoc with Pro Logic II decoders (stereo->surround processors), regardless of the bitrate, by stripping phase information which the

Absolutely this. mp3s wreak havoc with Pro Logic II decoders (stereo->surround processors), regardless of the bitrate, by stripping phase information which the DSP uses for sound steering. Also, the extra speakers allow you to spatially isolate sounds that would normally be masked - this can actually be a richer listening experience, but with lossy encoding it's a mess. More generally, this applies to any scenario where the sound is distorted or altered by something. A crappy speaker might have a perverse frequency response. A room reflection might manifest as a comb filter. Both will destroy the careful masking assumptions of any psychoacoustic model. Lossy compression should be avoided as an archival format whenever possible, even if you think you know better, because you never know when you might need the information you thoughtlessly threw away.