Recording Help- Reasonable file size

I'm doing some recording and I'm fairly inexperienced at it. I'm using cakewalk express and just putting my guitar through a POD into my soundcard. Anyways, I'm looking to submit my latest creation to guitarwar. Anyone familiar with this site knows that it has a 550k max file size, and reaching this limit always kills me, while the pro guys there have 10 times the quality and a fraction of the filesize. My question is, how can I reduce my filesize?? Obviously I compress the .wav file to mp3 (at the lowest bitrate possible- 32 I believe) after I export it from Cakewalk, but besides this standard step I don't know how to compress it. Any help would be greatly appreciated, or any if you could give me any sites where I could learn more about this, that would also be appreciated.

Changing it from stereo to mono will nearly half your file size.

Well, when I convert from wav to mp3 I always encode mono. Doesn't do nearly enough though.

try making the .wav mono, or better yet, go mono from the start. If that doesn't do it, them I'm fresh out of ideas.