Hi Macro:
OK -- let's make some tests. For the tests, don't run any other programs "in the background." Let WAVEPAD have all the computer resources.
First make a COPY of the file you are starting with (so we don't mess it up while we fool around with the copy). Let's call it "TEST.MP3".
Now, start WAVEPAD, and load TEST.MP3. WavePad will convert the MP3 to a WAV file and display a waveform. Slide the cursor to the loudest part of the waveform, and play a little of the loudest part. Look at the green VU meters in the lower right part of the screen. Are they showing any RED?
Stop playing the file, and don't make any edits.
From the FILE menu, click on "SAVE FILE AS..."
Name the saved file "TEST.WAV".
Now, again from the FILE menu, click on "SAVE FILE AS..."
Change the SAVE AS TYPE dropdown to "MP3".
Name the saved file "TEST2.MP3".
Now, close WAVEPAD.
Play the three files (TEST.MP3, TEST.WAV, TEST2.MP3) in another player (maybe Windows Media Player) -- which files, if any, sound distorted?
Jerry