I am using Audiograbber v1.81 build 2, Lame v3.89beta (internal DLL) and Win2k SP2. I have a Dell Inspiron 3700 notebook, PIII-500, with 512 MB RAM. I know this is not exactly the software configuration you are using but for what it is worth I have not been able to duplicate the problem you described. Audiograbber is working well with Lame encloding at 192 or 256. I am using an internal Dell CD-RW drive (Sony CRX-700E).
I started with MusicMatch Jukebox and could not produce a clean file, free of pops and clicks, no matter what I tried. Let me know if you would like me to try some other testing.