Step 6: Audio Encoding Options
Now it's time to set up the audio encoding options. If you've followed this guide for DVD conversion, then the demuxed audio track we selected in the D2V Creator should already be loaded in (if not, load in the .ac3 file that was created). If you are not converting from a DVD source, then you can either load in a separate audio file or if you edited the AviSynth script (set "audio=true"), then load in the AVS file into the "Audio Input" section (meaning both video and audio inputs are the same AVS file). If you want more than one audio track, right click on this audio aread and select "New Track". If you changed your mind about including an audio track, click on the "X" button to remove the audio from being included.
Now we select an audio codec to use. I prefer AAC audio, especially with H.264 as video - AAC is to MP3 what H.264 is to DivX/XviD, better compression + better quality. So which audio codec should you use? I prefer Nero AAC (Nero Digital), so select it if you agree with me. We can now choose a "Nero AAC" profile for the "Encoder settings" option. "NDAAC-LC-96Kbps" is the one I like, as it will give you roughly the same quality as a 128 Kbps MP3 file and using LC, it retains maximum compatibility with standalones. Alternatively, you can click on "Config" and modify any existing profile, and then save that as a new profile (in the screenshot above, I've created a new "NDAAC-LC-128Kbps" profile.
For more information on AAC audio options, please refer to this MeWiki page
or this Wikipedia entry