razzer, there has always been another simple way to do this. Of course, Apple doesn't like us to talk about it on their site (I and others have recently had threads pulled for even mentioning part of the process) due to legal issues involving the record labels.
Since the iTunes store opened, it has always been possible to burn purchased music to CD. That CD acts in every way like a CD you buy in a store. That means you can then import the CD as mp3 tracks.
The process will produce a track with exactly the same quality as your process, as transcoding is transcoding and you will loose quality no mater what. Best part? My tracks only cost 99 cents each ;-)
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My two iPods are jealous of my two MPx players.
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