I tried to figure out MOD playing, last night, but that didn't go very well at all!
Today, I'll probably focus on OGG playback, instead.
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OGG works the same way as MP3s, in that it's a way to compress audio for streaming.
But the format isn't as locked down in license gubbins as MP3s are, so it's much easier to just write things that work, and not have to worry about licensing all manner of bits of your game.

Licenses are OK when you have a big seller, making oodles of profit. But when you're making 30+ games a year, and giving them away for free, it doesn't make sense to have to pay $100 or more for each and every one of them.
Incidentally, the price for licensing Bass (a Mod playing library) was about $400 per game. .. Sod that!!

So, OGG for pre-rendered music, and (if I can figure it out!) XMP will more than likely be used for doing MOD playback.
Or at least, that's the plan. I just need to get both of them working, first.
.. And that's the tricky part!

I'm very much bluffing my way through this whole thing, but hopefully I'll have it all working soon enough.