But as far as the encoding was, I have no clue. But one would think If your trying to sell a product one would use the best format.
It would make a HUGE difference how the music was formatted. I'm sure at Best Buy they were pushing MP3's to show off the capacity of the unit, as most folks clearly just aren't that discriminating about the quality of the sound, judging by what sells, and how popular downloads have become. The iPod holds far more music in compressed formats, and that would be something they'd be bragging about too, especially if it were one of the smaller units like a Nano. Not to wish more abuse on your ears, but you may want to give it another try with files that are uncompressed (WAV) or compressed in a lossles format (Apple Lossless), and make sure to use a decent pair of earbuds (like Shure E4's or E5 or E500). You may not have the hot Latino to make the experience as memorable, but I bet you'd be more impressed with the iPod. Then again, maybe not.
Do you understand the concept of compression as it is related to audio files?
Marco