takashi, we already told him the format - it has to be either .WAV or .OGG.
rubedo:
IIRC, no, MP3s don't work in retail FS2, although you should try to get that problem with FSO sorted out here

What's your system specs/what's it doing specifically?)
You have another option you can try, with the music, although it's kind of a hack-job. Create a new folder in your FS2 root directory, and name it "Mysongs" or something. Then, go into it and create a VP file and name it something. Then, go into the VP file and create a folder called "music".
Then, go through your FS2 VPs and look at all the track names. For the tracks that you want to replace, convert your MP3s into WAVs or OGGs, and name them the same as the track you want replaced. Then, add all of these files into your VP.
When you go to launch the game, go to the "Mod" tab in the launcher and point it to your directory. That should do the trick.
Now, if you're going to use retail FS2, take that VP and put it in the FS2 root directory - this I'm 90% sure will work, although I'm not sure. Either that, or take all your music that you've converted and renamed, and stick it in the FS2/data/music directory. That WILL work, altho it's messy and nasty and I wouldn't recommend it.
Now, it's been awhile since I've done this sort of stuff, so if anyone wants to correct me, feel free

But I think that should work. Sorry if it's confusing

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By the way,does anyone remember what happened to that segment of unused code that was found, that indicated maybe an ability for FS2 to play music off a CD? Is that under development at all?