Hi Doug.

I have to disagree (well, sort of) with you on some points, while agreeing with the tenor of your post:
I would not worry about the 128kbps encoded files that were ripped from tape. They probably wouldn't sound any better than they are now when re-ripped and encoded with even 360kbps. It sure wouldn't be worth the hassle.
Regarding the music that was ripped from CD: I would vote for a re-rip if Steve is not satisfied with the sound of a song.
You said:
A marginally encoded song (for example, a 96 kbps download from the internet) will probably sound better played on a really good stereo system than a perfectly encoded (Plextor CD player, EAC and Lame at 256 kbps) song on most original factory stereos.
Problem with this is: He isn't listening to the song on a factory stereo, but on an empeg. I am mostly unable to hear a difference between a 128kbps (LAME) encoded file and a 256kbps encoded one on my computers (but can tell quite a difference between different encoders). I can easily tell the difference when listening to those files on the empeg, no matter which speakers I use (ranging from el-cheapo PC-speakers for approx. 10US$ to my factory speakers in my car).

There are many factors that are influencing the quality of your sound system, among them the choice of amp, speakers, cables, equalizer settings etc. However big those influences are, the encoding quality still is a big factor. Not one to overly worry about, but still one to consider.

cu,
sven

proud MkII owner (12GB blue/green/smoked, was #080000113 is #090001010)