"What is the difference between MP3 and AAC?"
its a lossy audio compression (your source from speakers can have 1400 kb/s so you need to compress it). If you have AAC from itunes then it requires less bitrate than MP3 to output the similair quality, but not in streaming programs like OBS, XSplit etc. They use shitty AAC version so MP3 its better solution. MP3 V2 (190 kb/s) can produce transparent audio (AAC in mca64Launcher required 240 kb/s for that). Gernally best is use MP3 320 kb/s in mca64Launcher, quality almost the same as AUDIO CD.
For local recordings, in mca64Launcher you have more choice. You can use lossless audio compresion like FLAC, WAVEPACK or ALAC, for lossy you have also OPUS (best option for low bitrates like 80 kb/s). Even you can H.265 for VIDEO, but thats required very good CPU, or oldschool Xvid. Many dont know, but all this choice you dont have in OBS or XSplit
to all streamers use good quality audio source like mp3 V0, MP3 320, itunes files or FLAC
dont use shitty spotify
Preserve quality! and support musicians, just buy their music!!