Why convert?
This highlights the current dilema for what format should your source library be?
I went round and round and really liked FLAC, it was lossless, open, could be streamed and had tags. The major downside was client support.
For lossless, the only common format is WAV, however despite the fact it can support tags, nobody does, or they use proprietary ones.
A few years back I had ripped my entire collection in MP3Pro thinking it would catch on. I learned :-)
My priority was good streaming, so my solution was to buy a bigger disk and rip the entire collection again using WAV (500GB for less than $150 supports over 500 CD's), MC12 provide all the information regarding artist, title etc. to my Denon 4806CI. Browsing is almost instant, I get truely lossless because I didn't go via an MP3 codec, ripped HDCD's even work.
If I want to load music onto my MP3 player, MC converts on the fly (OK, convert then download :-) ) and it doesn't really matter if it takes a few extra seconds.
If one day there is a universally supported format which does all I want, I can be 99.99% sure there will be a way to convert from WAV.
OK, so that sorts out my audio, now if I could just find a universal video format with: -
Good client support
Subtitles
Menus
Multi Audio track support
Good compression like H.264, MP4 or xvid/Divx
On the fly transcoding of video is really going to warm up my server room, it's warm enough as it is!