@Cass
I use AHIRecord v1.7 to generate 16bit .wav files onto the HD.
I use Samplitude for any editing. It's superb and there is a free demo available.
Both the above support the Prelude sound card. Maybe other cards too (?).
To generate the MP3s, I use LAME. The latest version is 3.93.1 (for the 060) from Aminet.
Cheers,
JaX