well..... this is some interesting stuff....
I don't pretend to know the intimate details of what happens behind the curtain .... but I do know that I always try to use the highest bit rate on the MP3 that will fit into the particular mp3 website's player given their limitations on file size. I shoot for 320 but will back off as needed.
320 on my portable players always.
I also know that something is missing because a wave of 40MB gets slammed back to 4 to 5 MB in the mp3 format..... so it had to drop something..... mathematically, it appears to be a ..... keep one bit, drop 8 or 9.... keep one,,,, drop another 8 or 9.... but I know it's not that simple.
I know the basic rules and pretty much follow them..... leave head room, use the highest bit rate possible, etc....