Once your podcast is in the iTunes Store/Apple Podcasts then all you need to do to add an episode is to add it to the feed, in the same way that you added the original episode(s), and re-upload it. You woujld do this using whatever method you used to create your podcast in the first place. Many people use an online service provider, so you upload the media files, and their original location is irrelevant.
As to converting formats, the following is for the iTunes application:
Start by dragging the files concerned into the Songs list in iTunes if they aren't already there.
Then go to iTunes Preferences>General and click the 'Import Settings' button. Set 'Import Using' to 'MP3 Encoder' and use the next drop-down menu to choose your settings - you can choose 'Custom' and set the bitrate as suits you.
Click OK, then OK again to close the Preferences.
Go to the Music list; select the files you want to convert and from the 'File' menu choose 'Create new version' then 'Create MP3 version' (iTunes 11 - in earlier versions choose 'Create MP3 version' from the 'Advanced' menu).
MP3 versions will be created and placed in the music list (the original versions will remain there). You can drag them out if you want to save them elsewhere (doing this will not remove them from the Library). You can select and delete any files as required in the Music list. (Never tamper with the actual library in the Finder).