What is the best compressed iTunes format?


First, let me state that I fully understand that an uncompressed format is far superior to a compressed on such as MP3. My current iPod is a 4GB unit, but I just had the battery replaced on my wife's old 30GB unit and plan to transfer my music that direction.

I generally use it for listening at work on Sennheiser earbud headphones that retailed for about $80 new so we're not talking HiFi. My only iPod connection currently, or planned, to my main stereo is via an Onkyo dock so I'm not getting the benefit of an external DAC so again we're not talking HiFi.

Knowing that I have somewhat limited space, what would you recommend for me to choose as the format for iTunes. I've never done anything beyond one of the lower compression MP3 options, is there something better?

Please provide a suggestion and why.

Thanks
mceljo
If by compressed you mean a Lossy format, than 320kps MP3 sound very good. If you mean a Lossless format than Apple lossless is the choice.
In my experience, the sweet spot for compressed on an iPod would be AAC format 196Kps or MP3 format 256kps VBR (variable bit rate) for maximum music given your listening situation, (ear buds.)

Anything more would reduce the amount of music without much gain in fidelity that you could hear on ear buds.
Yes, I'm talking about a lossy format not WAV or Apple Lossless. I would assume that they both take up nearly the same amount of space?

Is there a lossy file type that is an Apple format? I'm assuming that the reason that the Apple Lossless is better than WAV is because the iPod DAC is better at the D/A on it.
I was just doing a little more research on the Apple Lossless format since I didn't realize that it reduced the file size so much compared to WAV.

Is this calculation correct?

30 GB = 30,000 MB / 652 MB (max per CD) = 45 CD (approx.)

If I assume that Apple Lossless is about 2/3 then the total goes up to 45 x 3/2 = 67 and the majority of CDs do not contain a full 652 MB so I should expect greater than 70 CDs to fit?