Also does this FLAC compression occur when wired?
It doesn't take into consideration whether the player is connected via wired or wireless. With the default settings, Squeezebox Server will always stream lossless formats as FLAC to conserve network bandwidth. So AIFF, WAV, ALAC, Monkey's Audio, WMA Lossless are normally converted and streamed as FLAC.
Does the Transporter then uncompress and play at full bit rate?
Absolutely. FLAC is lossless and all Squeezebox players, including the Transporter, can decode FLAC to the original 16/44.1 digital. FLAC is designed to be decompressed using minimal CPU resources - far less than codecs like ALAC and Monkey's Audio - so it's a great format for streaming and playing on low powered players.
But if you'd rather stream AIFF as AIFF, with no transcoding, you can do the following: Go to Settings > Advanced > File Types, where you see
File Format Stream Format Decoder
AIFF AIFF Native
FLAC flac/sox
MP3 lame
and change the FLAC -> flac/sox line to 'Disabled'. The only downside that I'm aware of is the increased network bandwidth required, which may strain some wireless networks and cause dropouts. Many wireless networks, however, will handle it just fine. If you have a wired connection to your server and players, you'll have no problem.
