It may help if you post the make and model of your vehicle and they level of audio system you have. I know that the late model Mercedes-Benz will transcode audio to the internal hard disk drive, but it it does not specify, or allow you to specify, what bitrate it does the conversion it. It is quite slow. Not sure if this is a result if the built-in processor, the codec, or what.
It has an internal hard disk, and this is partitioned off to store the navigation map data, the GraceNote database for automatic album and song naming if the CD does not have CD-TEXT, and for the compressed music in which it copies. It it is also DVD-A format compatible, playing DTS or Dolby 5.1, however these discs cannot be ripped to the internal hard disk.
The Mercedes-Benz system is very straight forward and easy to use. Also, using a PCMCIA adapter, you can copy MP3 files directly from an SD card to the internal hard disk, or play them directly. Some models have a USB connector in the glove compartment that connects directly to USB Flash disks (maybe even perhaps hard disks) iPods, and other devices. It can also receive audio using the Bluetooth audio transmission protocol, but I find this does not work as well as some of the other solutions.