> Over-focus on the highest possible quality

This is not an issue in my view. I like the fact that I can download 100 MiB ultra-high resolution TIFF files of scans of photographs from the original negative from the Library of Congress and 24-bit/96kHz FLAC files of captures of 78 RPM records from the Internet Archive. In addition to maintaining completeness and quality of information, one of the main goals of preservation is to guard against further degradation and information loss. You should try to preserve the highest quality copies available (because they contain more information) and re-encoding (deliberate degradation) should only be used to create convenient access copies.

Inferior copies, in addition to being less informative, have the potential to misinform. Only the archivist will enjoy space savings. All the readers who might consult your library in the infinite future will bear the cost.

> ...(e.g. lossless FLAC). This inflates the file size...

This is entirely the wrong view. The file size of a raw capture compressed to FLAC should be thought of as the “true” or “correct” size. It is roughly the most efficient (balancing various trade-offs) representation of sampled audio data that we can presently achieve. In preservation we seek to preserve the item or signal itself and not simply what we might perceive thereof. This human-centric perception view is just wrong. There is data in film photographs which cannot be perceived visually yet can be of interest to researchers and be revealed with digital image analysis tools.

As an example of how much information celluloid can contain see: https://vimeo.com/89784677 (context: he is comparing a Blu-ray and a scan of a 35mm print)