Yeah, I don't think this means mp3 support; just that you can use any Brawl music that you've unlocked so far. Though what's "SNOWMAN", I wonder...
Anyway, I think it's a very cool idea, though since I'm usually too lazy to build levels myself when games have this option, I'll probably just be playing everybody else's. And I think only having the three backgrounds is fine, as Sora doesn't want to created levels to be competing aesthetically with the ones they built themselves, and the excitement's supposed to be coming from the design anyway.