Here’s a little more detail on Google Music from my experience so far. I was able to upload a lossless wma album. Google Music encodes it into a 320kbps mp3. Unfortunately, I think 320kbps is a bit too much for 3G (if the connection is not great) and besides, it’s not really necessary on a portable device. Instead, I took the Lame mp3 VBR-encoded version of my music library (~180 – 220 kbps) and uploaded that.
I was sort of hoping it could house the wma lossless files and just transcode to an appropriate bitrate on the fly depending on speed–extremely wishful thinking on my part . I was able to tell what Google Music was doing/not doing to the files by looking at the cached files stored by the Android player. The good news is they don’t touch the mp3 encoded files. They appear to be exactly what was uploaded.
The service is obviously in beta stage and a bit rough, but it definitely has potential. The browser is used for managing and playing the library on the PC. It is classic Google, simple but effective for covering the essentials. The Android player is basically an updated version of the standard music player with more eye candy and the sync functionality. The Android player will pre-cache songs it thinks you will listen to and songs can also be downloaded for offline listening.