To get an idea of what can be accomplished with a PIC using 8-bit sampling visit
**broken link removed**
This is some experiments I made a couple of years ago. Please keep in mind that no pre filtering was performed on the samples and only a simple RC filter was used on the output. Also keep in mind that the audio was sampled on 1 16f877a, transmitted/received serially thru the uarts and then converted back to analog data in a second 16f877a using either R2R or PWM.