Personally I'd prefer a higher quality 2 CD version for a film of this length, but 1 CD is acceptable quality and will take half the time to distribute!
As well as distribution by FTP (give me a shout if you need any help setting up a server, BTW) there's the newsgroup alt.binaries.movies.divx - much higher traffic than a.b.starwars - and the old reliable ED2K P2P network.
And MP3 compression will not destroy surround information, as long as you use full stereo mode. (I've seen discussions on whether joint stereo mode will also keep the surround channel intact, but I can't remember what the conclusion was. Probably safer to go full stereo.)
I'd also like to see XviD rips of Deleted Magic and Building Empire, as I think they too deserve to be seen by a wider audience.