Music quality - Low Dynamic range?

It seems to me that the sound quality you get from the music store generally is way way below what you'd get from ripping the CD locally. Especially the dynamic range seems quite compressed.
Is this related to the format Apple stores the music on their servers, ie. is the 128Kbps AAC in fact transcoded from another format before being downloaded through the music store?
I just compared a 'Madonna - Live to Tell' I ripped locally with the one that came with 'The Immaculate Collection', downloaded from the store, and the difference is immence
And it's not just dynamic range issue, -it also seems to me that the downloaded music is 'confusing'. Not easy to explain, but the way it works out is like the music (compression?) 'changes' throughout the track, and you get the feeling that something is not the way it's supposed to be..
Am I going crazy here, or do some of you out there have the same experiences??
Thanks, cheers
S
(I should probably mention that I'm not listening to this at a $200 stereo, I spent quite an effort setting up my system, -even put in a parametric eq. (Behringer dsp-1124) to do bass management etc. etc.. I also always rip my music in 256k AAC, having encountered a couple of cases where I could hear the difference from 128 vs 256..)

Don,
You bring up some points that I've been wondering about as well. I would love to know exactly what type of media is used to import the songs into the iTMS. It's quite likely that they just use the final CD.
However, one of the interesting things I've discovered about iTunes is that it can read 24-bit files! So it is possible that the record company could use the original 24-bit master for importing into the iTMS. I strongly doubt that this is happening, but it would be great if Apple would come forward and let the consumers know how this transfer is taking place.
For my own, original music and other projects that I work on, I import the original 24-bit WAV or AIFF file(s) into iTunes. From that file, I convert it into an AAC file, for playing on my iPod, etc. It's a really cool bonus that iTunes will let you do this!!

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