I am happy with anything over 192kbps, and thrilled with 256k - 320k VBR. I now only download from eMusic.com, Amazon.com and iTunes Plus now, if I must buy it now. Otherwise I prefer to buy the CD on Amazon, rip it into my computer, and have both lossless CD and MP3's for almost the same price ($1 - $5 more).
While CD's sound better than my DAP, if I put a an Apple lossless AAC on my DAP they don't sound much better than 320kbps VBR on the DAP. I get a headache listening to 320kbps vs lossless about 100 times before I hear the difference. So, I switched from apple lossless back to 320kbps VBR for my DAP. If I need lossless, I'll whip out my CD player...