When youre importing music from a CD, what type of file do you choose for import?
AAC
AIFF
Apple Lossless
MP3
Wav

And what bitrate do you use?
128? Higher? Lower?

I don't want to have each song saved as a 4meg file unnecessarily. Enough of those and it will definitely make a space issue on the old hard drive.

Don't use iTunes to rip music from a cd unless you have a specific audiophile-esque reason to do so, I recommend (its free), once the file is ripped you can then add it to your iTunes library.

Generally speaking, you should rip your music to mp3 at 192kb - its the best tradeoff between sound quality, file size and compatibility with devices.

If this all sounds too hard, iTunes @ 192kb mp3 is your best bet. If you use the white earbuds that came with the iPod, then it doesn't matter what you do

When it comes to compressing music there is always a trade off between file size and audio quality, I would never consider encoding my music at a rate lower than 192kb/sec because the difference in sound quality is very obvious (to my ear), however depending on the quality of the device playing the file and your speakers or headphones, you may not notice a difference at all.

The AAC format is not as widely supported as MP3, which is why I would recommend ripping your music using the latter - incase you want to use it on another device someday and don't want to go through the process of re-encoding your collection.

As far as iTunes vs other programs for ripping/encoding your CDs, it is my understanding that iTunes doesnt do a great job - the file sizes for equivalent bitrates are larger and/or the sound quality isn't as good.

If file size is your primary concern, rip to mp3 @ 128kb. I suggest you try rip the same track at 128, 192 and 256kb and have a listen to all three - generally people notice a big jump from 128-192 and little to none from 192-256 unless using seriously high end audio gear.

You are a wealth of information dude, tyvvm.

Unless you have very high end headphones or speakers 128 is usually fine. Since it seems space is more important to you than quality, 128 is the way to go. I have a decent ear for music and totally can hear the difference between 128 and 192, but I still go to 128 to save space. If I want to listen to better quality music I just play a CD (you know, those round discs that you put in the Wii to play games? yeah they used to hold music).