From what I know about MP3s and the VB’s sound processor, the existing recordings are virtually lossless, no pun intended.
Of course, any time you go from digital, to analog, and back to digital, there’s going to be some quality loss. The only way to get truly “lossless” audio, is to get the data before it gets to the DAC in the VB (or make a 100% perfect emulator and capture the data that way).
All that being said, I wouldn’t mind having some FLAC’d VB rips, myself.
There has been some discussion, but nothing really came of it. Obviously the method is known, and the data that needs to be extracted is available, but there are currently no (publicly available) tools to do so, nor has a specific file format been nailed down (although one of the existing formats could probably be pressed into service). It’s an aspect of the VB that is definitely ripe for development.