Another forum member mentioned this in another thread (I can't find it in my myriad of subscribed threads), so credit goes to him or her.
It was right in front of my eyes, and all of you long time iTunes users probably already know this trick...but right on the Summary sync page of iTunes when your iPad is plugged in, there is a checkbox option about 3/4 of the way down the page to convert any audio file with a quality of over 128kbps to AAC.
I had 8.10GB of music on my iPad before this...I checked the box and hit sync, and now my music only takes up 5.3GB of room!
Honestly, I don't notice a difference between 128kbps and 192kbps, especially if listening via headphones...I don't sit there and say "wow this sounds like 192k song" so this is no difference to me. In addition, I don't use my iPad all that often for music, but if it matters to you obviously don't check the block.
Here is a screen shot just in case you are confused as to the location of this option: