The Treo 700p supports AAC natively for some odd reasons (it doesn’t support MP3 out of the box, IIRC), it’s great coz I’m a Mac user and I use iTunes for my lossless library, so converting to AAC is a piece of cake. These steps should be similar if you use iTunes on a Windows machine.
First of all, you need to download this hack for the SoundsApp to get it to recognize the .aac extension, and then either copy it to your SD card and launch it in LauncherX, or you can try to send it via Bluetooth…. Do a soft reset on the Treo. Then in iTunes go into Preferences->Advanced->Importing, select AAC Encoder, settings choose Custom, with bit rate of 96kbps, Auto sample rate, and Mono channels. Check the VBR checkbox.
In your iTunes library, select the track (in Apple Lossless, MP3, or AAC, doesn’t matter), and right-click on the track, and do “convert track to AAC“, it should be pretty quick. After that you will find the track in your iTunes music library folder. drag it somewhere, rename the extension to .aac, send the file over Bluetooth to your Treo and it should add it as a ringtone. Pretty straightforward. This is assuming that you had already paired your Treo with your computer.