if you digitized at 24 bit, then 16 bit is technically compressed. with flac, the waveforms aren't compressed, but the amplitude is, so audio buffs claim they can hear more separation. I can't hear it, but I also can't taste the difference between coffee bean origins, but I know people who can.

FLAC supports bit depths between 4 and 32 bits per sample (the reference decoders only support up to 24 bits per sampl). Other than that, it does not change the bit depth of the data.

I'm pretty sure the 16-vs-24 thing has been proven already. 24-bit only really makes sense if you're fucking with the material. Same with 44.1khz vs higher sample rates.

You could hear the difference with a 24 to 16 conversion only because it usually involves dithering, which means there is some injected noise. If they choose not to do that, 16-bit dynamic range is enough to store someone whispering in your ear next to a running jet engine.

According charts in google, a jet engine at 100 yards distance is 105dB louder than a whisper. 16 bits can do 96dB without dither.

More importantly, the problem isn't trying to hear 96dB of range all at once. The baseline is fixed in place, so when you have a quiet section all those high bits are 0 and you need the low bits to have enough detail by themselves. And a whisper is pretty far from the quietest thing you might have in a track.

If you can hear the dithering noise, then I'm pretty sure there are sounds you're hearing that would be wrong or missing without the dither.

It's not a binary decision, there are different dithering algorithms with different noise frequencies.

FLAC is a lossless encoding. You can reverse it and get a bit-for-bit identical WAV file.

Unfortunately, that is a big if and is frequently an issue on Bandcamp where stuff you get in flac has been passed through some lossy format. 7digital often sells flac for more money so hopefully that makes them more likely to verify that they are actually lossless (I haven't found an issue from them but only have a few albums there since the negative of them is the distributer model that is heavily geographically restricted).