Does encoding a low bit rate (say 128 kbps) Mp3 from a 320 kbps Mp3 produce the same thing as encoding it from the original lossless? Or does the way Mp3 work mean that the losses compound on each other?
You wouldn't get the same result as you would if encoding from the original source. The losses do compound. But 320 kbps is high enough that a one-generation-removed re-encode to 128 kbps would be perceptually acceptable.