QUOTE(Woodinville @ Jun 4 2007, 19:01)

You will loose something (depending on your dithering or noise shaping method of choice) on the conversion back to 16 bit. LIke others, I doubt this is audible.
You can easily prove an objective measurable difference, and create samples which give a clear audible difference if the volume is boosted on playback.
This isn't to dispute the fact that it's probably inaudible under normal circumstances.
Often, 16-bit sources encoded to mp3 remain approximately "self dithering" at the 16-bit level, but this isn't always the case. Sometimes the encoder removes the low level noise, and sometimes it removes high frequency noise shaped dither. This can leave a signal with a noise floor below the 16th bit (i.e. not self dithering). If you don't dither when decoding, then you are effectively truncating a higher bitdepth source, which isn't advisable. If you do dither, then non noise shaped dither could increase the noise floor wrt to the original, and noise shaped dither could increase the peak amplitude, possibly leading to (extra) clipping.
So the best option really is 24-bit decoding. (And, of course, some mechanism of preventing clipping, e.g. ReplayGain clipping prevention). I assume that's what most of us are doing with 24-bit sound cards and foobar2k. There's no reason
not to.
Not only does it not matter, but at 16-bits, against all theory and advice, I prefer to decode mp3s without dither because its very hard to make even an unrepresentative pathological sample where the truncation distortion is audible, whereas its slightly easier to make an unrepresentative pathological sample where the noise is audible. Even so, it really doesn't matter.
Cheers,
David.