You're absolutely right. They chose compression over quality to load as many concurrent calls per tower (CDMA, mind you) as tolerable. It used to be (maybe still is) that on the Motorola Razr v3m you could drop into a programming menu, and force the handset to use the higher bitrate vocoder, whereas the towers would request use of the lower bitrate vocoder. Around Chicago, in 2000, for example, Sprint CDMA was indistinguishable from a landline, likely because the towers were telling handsets to encode with the high bitrate.