all your formats are digital, pcm for wav and then converted to analogue to be heard or fed to speakers
analogue storage was the old large tape reels in studios which you physically cut with a razor to edit
https://www.whathifi.com/advice/mp3-aac-wav-flac-all-the-audio-file-formats-explained
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If the BT connection is still available it looks like a phone issue. Perhaps there's been a phone OS update or the BT profile has changed. That's where I would be looking.
No different to engine braking in a manual car, especially a diesel. But it is something I try to be aware of in the Leaf if I have a Ranger right up my arse on the motorway (so, every day)