Hello and welcome archmonde11,
Regarding your questions about MD/HiMD formatting.
You are correct, this is a choice of the format placed on the disc. The original MD format using MDLP (ATRAC3 CODEC compression options) was designed for storage of 80 minutes of music at 292Kbps (SP mode) very good sound quality, but limited duration and capacity, 160 minutes of music at 132Kbps (LP2 mode) decent sound quality but with compression artifacts being more obvious or 320 minutes of music at 66Kbps (LP4 mode) so-so sound quality, not acceptable to some.
With HiMD, you are able to place the HiMD format on an older 80 minute disc, the HiMD format allows for the storage of higher duration of source material. The comparison is not apples to apples because Sony began stating the capacity of a disc in MB or GB versus minutes of storage space.
An 80 minute disk prepared with HiMD format has access to the newer ATRAC3plus compression options as well as the original ATRAC3 options. Using ATRAC3 you can store approximately 5 hours LP2 and 10 hours LP4, using the newer ATRAC3plus CODECs for compression, an 80 minute disc prepared with HiMD format can store approximately 2 hours 30 minutes of 256Kbps (Hi-SP), 10 hours of 64Kbps (Hi-LP). There are some other ATRAC3plus CODEC options as well, however some cannot be transferred to MD regardless of the format placed on the disk.
Using a 1GB HiMD disc, which can only be formatted using the HiMD format, you can store many more hours of ATRAC3 and ATRAC3Plus content. The disc is has roughly 3.25 times the capacity of an 80 minute disc and can hold around 8 hours of ATRAC3plus 256Kbps (HiSP) which is great. It can also store around 16 hours of ATRAC3 132Kbps (LP2).
PCM can be stored on both disk types as well, although at the cost of capacity. An 80 minute HiMD formatted disc can store around 30 minutes of PCM, a 1GB HiMD disc can store around 94 minutes of PCM.
I personally use new old stock 80 Minute MD disks in two modes, optical recording of SP (292Kbps) straight to disc for fantastic sound quality, but only 80 minutes of storage (same as CD). I also frequently use two other combinations of format and CODEC. 80 minute MD prepared with HiMD format using ATRAC3plus HiSP (256Kbps) for about 2.5 hours per disk with great sound quality as well as 80 minute MD prepared with HiMD format using ATRAC3 LP2 (132Kbps) for about 5 hours per disk with decent sound quality.
I own around 10 HiMD discs but find that I do not use them often.
Have fun figuring it all out, the RH1 is a sweet unit, I love mine and use it nearly every day.