well, you can use 3rd party decoders, but i guess you are not allowed to bundle them. just like those audio rippers, you will need to use your own codec or download LAME (free open source mp3 decoder), but they aren't allowed to bundle the program with LAME.
It would make everything pretty complicated.
Anyway, LFS is a racing simulator, not a media player
I don't hear any music while racing, but if i would, i would just use Winamp or something else, imho it's better than a ingame player.