Why is the "create mp3 version" greyed out?

One reason you can't create a mp3 version from AAC is because you might have purchased the song, but you need to ensure it is actually downloaded onto your current computer.

If it is on the cloud, but not physically on your computer, you can't create a MP3 version.

To fix this, you need to actually download each individual song in question, then make the MP3 version as desired.

Also, if you need the list of events, it's as follows:

Open Music

Under Library, I click on songs

View

Show View options, click cloud downloads (So you can download the song if it's only on the cloud and not on your computer).

Once the song is downloaded, (Also works for multiple songs)

click File

Convert Create MP3 version.

Note: If you have been able to create MP3 versions in the past, but now it seems disabled, this is how you work around to get it active again.

I hope this information is helpful.