Right here's the problem, there are two completely different use cases for transcoding.
1) The player you are using does not support the audio format
2) The source file is in too high a quality - e.g streaming over 3G mobile
In the first instance, you need the transcoding to always happen, irrespective of the max bitrate you have set for your current connection wifi / mobile
In the second instance, you only want to transcode if the bitrate of the source file exceeds your max bit rate.
Examples:
Example 1
source: 320k mp3
transcoder: none
max bitrate: 128k
result: 320k mp3 - which violates max bitrate
Example 2
source: 320k mp3
transcoder: mp3 to aac enabled
max bitrate: 128k
result: 128k aac - which is correct
but
source: 128k mp3
transcoder: mp3 to aac enabled
max bitrate: 128k
result: 128k aac - which is not what you want
Work around
Create two different user accounts, call one mobile and set the transcode options such that all formats get trancoded to your high compression format of choice, ogg/aac etc.
In the other account disable all transcodes for your player bar the ones essential for your player.
You then need to swap servers in your client before playback. This is both fiddly and also not perfect as you can still end up doing pointless transcodes where you go from the same source bitrate and format to your target, just because you need that profile enabled as some of your files might exceed your max, e.g 128k mp3 to 128k mp3 just because your 320k mp3s are too big for mobile data
Proposed Solution
Simply add a new checkbox next to the transcoder that says "Downsample Only". This then ensures that this transcoder is only used when the target bitrate is lower than the source. Problem solved !
I'm happy to try and code it and send a patch if people like this idea and said patch would be accepted (subject to usual code submission rules etc)