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I don't know, but it is what one of my friends, who is a long-time vinyl digitalizer and digital DJ told me.So, the compression level chosen during encoding should have no bearing on DJing since you are just decoding the audio and not encoding it.
What I know is that when you throw an mp3 in iZotope to see the spectrum, it takes a lot longer to load than a FLAC, which also takes a lot longer to load than a WAV.