Technically, you shouldn't be able to hear a difference between 128Kbps AAC and 16-bit Linear PCM... but some people will insist that you can despite a total lack of any technical understanding of how perceptual coding schema work relative to the A-weighted spectrum.
I'll be supporting the premium tracks, but mainly to help boost the figures for non-DRM file sales.
I'm afraid I disagree. Very high frequencies definitely seem to lose something on my 128k AAC tracks, normally with cymbals, most notably on the hi-hat. I don't really notice anything at 160k unless you were to play it on a cd straight after where there is a definite loss of...how can I put this technically...OOOOMPH!
I'm very happy that they're pushing album sales as opposed to singles but I don't really completely approve of non-physical media. Sure, I rip all my CDs to iTunes, but I've still got a bookcase full of cds with booklets and cover art that I can actually hold. As a musician, the cover is a very important part of making an album. It's a visual representation of the music that is not being appreciated so much with digital stuff. I mean look at the track listing on the back of your favourite cd and then look at your list of tracks written in Lucida Grande typeface in a grey box on a monitor.
...and let's not forget about your local independent record shop that isn't being done any favours by digital music.
Most of this post probably belongs in a different forum, namely the "whining musician" thread.