You're welcome! Glad it helped!
Yeah, I just kind of stumbled upon that one day. In fact, after writing those directions I went back changed my setting from 128 to 64 and... I must say I DO notice a slight difference. Maybe it's just a mental thing (i.e. my brain knows they were loaded at 64 and is therefore looking for the "muddiness") but even after resetting my EQ the sound quality's not quite where it was at 128 -- and I'm using headphones.
I've actually got the 2GB model, so I may just live with the slightly lesser sound quality for a while in order to keep so many songs on there (around 900). I'm sure I'll get used to it after a while anyway, but if you've got the 4GB I'd recommend keeping everything at 128. Your call. Again, PERSONAL PREFERENCE