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I use Mediacoder to transcode my mp3 files to aac With nero encoder HE-AAc v2
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There's no point in encoding from one lossy format to another. Never be a fair comparison.
If the source is lossless or atleast 320kps (mp3), aac (mp4/m4a) will deliver more quality at 64kbps than mp3 codec (simple fact : it can compress better). Make sure to keep HEv2 below 128kps & LC for above.
But "ogg" at 64kps encoded with aoTuV (ogg encoder) will beat them both hands-down.
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any other better encoder settings or FREE software to transcode aac would be appreciated
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Almost all use "Nero-encoder" (except shitty iTunes) & its free. Only your settings & the source matters. Still, my personal fav is foobar with all encoders.