iTunes music for home and on the go?

How do folks manage your iTunes libraries so that you can have uncompressed files for the home rig and compressed files for the iPod? I've got 600+ CDs ripped (using Apple Lossless) on an external drive. What's the most sensible -- and easiest -- way to create compressed files to put some of this music on my iPod? (Assuming, that is, that that is the way to go.) Thanks.

-- Howard