Best settings for ripping cd's into iTines?

If you don't care how big the files are you can import to AIFF for quality equivalent to the original CD. Alternatively convert to Apple Lossless (ALE) which is also equivalent quality to the original CD but about 60% the size. I can't think of many scenarios where moving the media to a different player may mean something can be played in AIFF but not in ALE and in the end I can't really think of any reason not to use ALE given your setup.

When it comes down to it, it is a matter of what you can hear. MP3 and other "lossy" codecs save space by tossing out data that research into human hearing says most people probably can't hear. Things above and below certain frequencies. Quiet noises masked by loud noises. The higher the settings the less gets tossed out, but some always gets tossed out with MP3 and AAC. Your 320k, for example, is supposed to be CD equivalent, but is still missing some data vs. CD. 128 k is touted as being FM radio equivalent. With my older ears I can barely tell the difference between 128k and 256k and probably not at all the difference between 256k and 320. As for original CD, probably not at all, particularly at really high frequencies unless I have equalizer settings really skewed to that end. Not even the fanciest speakers are going to bring that back. In the end it is a matter of running tests using different tracks and various encoder settings and listening. Or if you really do have drive space you can just play it safe and stick with ALE or AIFF.

If you're concerned about preserving audio quality then a lossless format is definitely the best way to go, as long as you have sufficient disc space. Unfortunately there is no "universal" format for lossless audio - or, rather, no universal container format since all the alternatives use the same PCM 16-bit/44.1kHz audio encoding as CDs (though some also support higher spec encoding up to 24-bit/192kHz). The most widely used is probably FLAC (Free Lossless Audio Codec) but this is unfortunately not supported by iTunes, though there are some 3rd party add-ons that do so, and cannot be transferred to iDevices. WAV is also common but has the major disadvantage of having no support for embedded metadata - it is little more than the most basic OS file info wrapped around the raw PCM data.

Of the two formats that are supported natively by iTunes, AIFF is non-compressed (i.e., files will be the same size as WAVs), whereas Apple Lossless/ALAC employs a similar lossless compression method to that used by FLAC. As Limnos says, Apple Lossless is generally to be preferred, and if you do encounter a case where a different lossless encoding is required can be converted, without loss of quality, to the latter.

For the lossy options, either AAC or MP3 at bit rates of 256kbps are generally acceptable in non-demanding listening environments (desktop speakers, in-car systems, iDevices), but the difference between these and lossless - especially with well-recorded material with a wide dynamic range - will be noticeable on higher spec systems. I do need to pick up on one of Limnos's comments, that "128 k is touted as being FM radio equivalent". That's probably true in some cases, particular with US radio stations, but could be misleading to those used to high quality FM radio broadcasts, such as BBC Radio 3 (classical music) whose quality approaches that of CDs - even though its not as good as it once was due to the introduction of compressed digital feeds to the transmitters.

In my own case I've actually stuck to the principle that when I want to listen to music in CD quality I'll use CDs! Within iTunes - which I use over small desktop speakers in my office or via Bluetooth speakers when traveling - I stick as far as possible to a mix of 256kpbs AAC for CD imports and 256-320kbps for digital purchases (primarily from Amazon). The exception is for non-commercial live recordings, generally available in FLAC or older equivalents (Shorten, APE), which I am in the process of converting to ALAC.