I can't help with speakers for a stereo. I still have huge Klipsch box speakers from the early 80's that sound better to me for listening to CDs than 7.1 miniature bullshit.
mp3s are lossy compressed. It screws up the audio quality to varying degrees depending on the bitrate and encoder that was used and of course speaker quality. mp3s can screw up certain sounds more than others and make them come out tinny and ear-irritant, like vocals or certain classical instruments.
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