.mp3's are created by "discarding" parts of the starting .wav file. Generally the encoding program is supposed to be making intelligent decisions about what parts of the music are important for us to be hearing and what parts aren't. By discarding some of the information that the ear doesn't distinguish, the files are able to much smaller.
The "quality" of the resulting .mp3 is a function of both bit rate it has been encoded at (the higher the bit rate the better the quality - but also the bigger the file), as well as the encoding program that has been used. Each encoder uses its own algorithm, and hence there will be sound differences between encoders.
However, because the .mp3 has been "compressed", it will rarely sound as good as the original .wav file.
My suggestions to you would be to try encoding at a higher bit rate. The minimum you should use is 128, but you can go to 160 without too much of a size penalty. Also, try another encoder. Do a search for the Lame encoder. It is reputed to be quite good, and I believe it is available as freeware, or shareware.
