"- Mastered for iTunes: Rolling out on a worldwide basis, Apple is now featuring songs and albums that have been specifically mastered for the iTunes Store to provide the best sound quality for the format."
AKA Musicians who're writing their music with MP3 compression in mind.
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Not really. I remember reading a article about some classical music record company using algorithm to make CDs sound better. IN don't know the details, but it was something like they don't take the value at each sample, but look at the value before and after and decide on a better value.
So, yes, it is compressed and yes, sample rate is smaller than source, but if you encode intelligently, it will sound **better**.
That being said, purists, like descendants of kings that had great composers on retainer, will say that a full orchestra in the castle is the best. Followed by 8-track...
Cheers!