A recent discovery about audio streams (playable via your land settings) in Second Life: they are not played thru a utility MP3 player (like Quicktime) as a separate stream. They are somehow processed and re-compressed before being streamed thru the client.

Proof came when I scripted up a morse code practice radio in SL. I pointed the unit to several pure morse code MP3's on the ARRL website (check out the archive here: http://www.arrl.org/w1aw/morse/Archive/), and found the resulting audio in-world was filled with chirps, distortions and burps that are not present in the original MP3 files.

Demonstration: go in world and set your land audio to:
http://www.arrl.org/w1aw/morse/Archive/18%20WPM%20files/091218WPM.mp3

Now, put that same URL into your browser and listen. Hear the difference? Same file, same server. Hmmmm.

I delved deeper into the issue and found that the extreme nature of the morse code MP3's simply blows out the audio compression routines in use with Second Life. These morse code files are (1) low bandwith, running at 8kHz (vs. most audio files that are at 44.1kHz), (2) they are mono (vs. stereo), (3) they are maximally optimized for volume (the data is as loud as possible), and (4) they are simple on-off sine waves. Pure, loud, short tones with almost total silence between them.

I fixed the way the files play in-world by putting the morse code MP3 file into an audio editor and (1) reducing the volume of the code sounds by 9db and by adding a background of tuner-noise, amplified. The new file plays perfectly in SL. You can hear it here:

http://www.sltriptips.com/audio/091218WPM_wnoise.mp3

And, if you paste that into your land's audio stream, you'll hear it come through just fine.

Fascinating.