best way to store audio files

1. I think would have to be up to you. Storing them all in the WordPress media would mainly just increase the size of the site and then you’d be paying more to your host. Could potentially result in lower speeds depending on how the server is set up as well. Positive is that (and this is my personal opinion) WordPress has a pretty clean player which allows for some CSS customization and its just nice having everything on the site.
2. If the site is a representation of the music/audio your selling I would always go with the higher quality audio.
3. Compressing the audio takes away from the quality of the sound. Mind you I wouldn’t consider myself a sound professional at all but I know this all matters to professionals.

On the other hand, I think going with storing the audio files externally avoids most of the issues I described. Since you have so many it might be the way to go but it would have to be up to you.

What’s the purpose of the site? If you’re just setting up something to play your own media, you might not want WP at all, but use the free Plex Media Server. (That’s what I use for over 12,000 tracks of music and video.)

The purpose of the site if for people to listen to audio clips I’ve made for no charge.

They are talks on different topics. I want people to browse topics and listen and enjoy.

Short talks, just listen and/or download. That is it.

I prefer to store them on WordPress unless that will slow the site significantly. I was going to code <audio> html to allow them to listen, not use the WordPress player as I need to dynamically insert the URL for the audio.

What do you advise?

Yeah, not an application for Plex. If you’re on a hosting plan that has a bandwidth limit, streaming audio could push you over that. It’s not that it slows your site, it’s that your host may not want them stored there. There are a number of plugins you can use to make it easier to manage your audio files.