SID loves Paula

[freqmax]

I compressed some "Jean-Michel Jarre" to mp3 using Fraunhofer. And I had to use 256 kbit/s "slow"-mode for some of them. They just wouldn't sound right otherwise. The other clue is that that kind of music consist of many quite pure sinewaves. It wouldn't be a far stretch to imagine that SID and Paula have similar characteristics and thus compress badly. Especially when the algorithm tries to skip sinewaves it think won't be missed. And the same waves makes up the music.
The software implementation of the algorithm also tend to cut frequencies above 16 kHz.

I would recommend the lossless compression algorithm FLAC.

[freqmax]

Actually, sines can be reproduced very accurately in MP3 since it works by splitting a sample into its frequency portions (via FFT).

More precisely many C64 sounds are square, triangle, sine, noise modified in frequency and amplitude vs time. And likely to contain many high frequencies to make it sound right. Exactly the frequencies that lossy compression will remove.

Also intentionally used misaligned sample frequencies on Amiga can suffer in the compression process.