[mere aNUs]

If I set the Stereo Bit Rate setting to 256 kbps, does that mean that the highest it will go up to is 256, and the rest will be below that at whatever it needs? I've seen MP3s that are 181 kbps, for example, and I'm looking for a way to be able to encode my CDs with AAC the same way as that - not every song is at a set bit rate, it only uses up as much as it needs.

[SpaceMonkey]

I believe in iTunes' AAC VBR mode, the bitrate setting sets the minimum allowed bitrate (not including "silent" patches where the bitrate is close to zero). However, this does not mean that the encoder will always go as high as it "needs" to in the more complex passages. Rather (based on my own testing), it seems that it will only go up by a certain amount over your baseline bitrate setting. That is, a particularly complex song encoded at 160 kbps VBR might come out with an average bitrate of 175 kbps, but a 128 kbps VBR encoding on the same song will only result in an average bitrate of 143 kbps.

[Thinine]

I think that's correct. I remember when VBR first became an option I did some testing and the 128kb VBR files were bigger than the 128kb CBR files.