The format is up to you. You have multiple options - these are the most popular:
- MP3 ("lossy") - Smallest file size, music files are compressed and musical information is lost. I would recommend 320k if using mp3. Most people can't tell the difference between 320k .mp3 and CD
- FLAC ("lossless") - Medium file size - music files are compressed, but no musical information is lost - will sound exactly the same as the CD.
- WAV ("lossless") - Largest file size - music is not compressed in any way and no musical information is lost - will sound exactly the same as the CD.
Personally, I prefer FLAC format - you get full sound quality and compressed files to save space. FIles are larger than .mp3 files, but there is absolutely no loss in sound quality with FLAC.
In my 2018 GT with the 8.4 system, it supports all three of these formats.
My opinion is MP3 is beyone perfectly fine for listening to anything audio. 128 is fine as well for the vast majority of people/equipment. I typically encode higher now, just because storage is basically free now. I do still encode audio books at 128 mono, so it is ½ the space of "normal" MP3 and I sure don't need stereo for those.
Nothing wrong with 320 since storage is so cheap now, but personally I don't bother that high. Maybe I will re-rip stuff to compare, but the only thing likely to be affected is high frequency and I can't hear that high of a frequency anymore unless it is blasted.
Lossless is one of those things that is cool, but never notice the difference, like shooting RAW in a camera, unless you are going to be processing the data, not just enjoying it, let the compression do its thing and enjoy the 1/10 of the space it takes up. That also speeds up copying the data by 10x!
I must have messed with 5-6 different audio management programs, and encoders. I finally settled on iTunes a good while ago, for the standardization, and haven't looked back.
For video I use a ton of various open source tools, same as the OS on my players, I used Rockbox for a long time, even on iPods. But I stuck with iTunes on my PC itself. I think my default is 192 now, just for kicks, 50% more data can't hurt, and I'd never notice the additional space needed.
The best thing is, as long as you are doing it legally, you can try over and over.