The first graphic is of a sound clip in 100% distortion. I suspect if you turned on View > Show Clipping, the screen would light up solid red overload bars. It’s not normal to have the dark blue waves live at 1.0 in a solid block of blue. I suspect if you played that piece, the Audacity sound meters would turn red, smash to the right and stay there.
That might be why the conversion to MP3 failed. MP3 compression process “knows” what content is and tries to hide compression damage by carefully folding it into the music or voice. Audacity uses Lame MP3 work-alike software instead of Fraunhofer-Gesellschaft “the real thing.” While I have no doubt they both do a credible job with well-behaved sound files, I wonder how well they’ll do with unusual sound files like yours.
It’s not normal to have the dark blue waves live at 1.0 in a solid block of blue.
The waveform is actually at approx 0.5, but I see what you mean about the blue section being live at 1.0; is there any way I can reduce that? I haven’t done any adjusting to the audio at all, just cut a section and exported it.