I just presented a paper at the recent 132nd AES Convention in Budapest entitled "Some New Evidence That Teenager and College Students May Prefer Accurate Sound Reproduction" that refutes Berger's findings that kids like bad sound.
In my study none of 58 high school and college students I tested preferred MP3 (128 kbps) to CD-quality music files. On average, the students preferred CD to MP3 in 70% of the trials. The students with more critical listening experience tended to prefer CD in a higher percentage of trials than those students with less or no experience.
In a separate loudspeaker test where four consumer loudspeakers were evaluated under double-blind conditions, the most preferred loudspeaker had the most accurate set of anechoic measurements, and the least preferred loudspeaker had the least accurate set of anechoic measurements. So, it seems that kids can hear and appreciate good sound just like the rest of us. When given the opportunity to compare good sound to bad sound, the youngsters generally prefer the higher quality options.
Sound and Vision has summarized the paper
here: