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Probably easier to just plug my phone into the aux input and record with audacity.

Not really. The hardest part is getting the activation bytes and even that is actually quite simple and you only have to do it once. For the actual converting I have a bash script that can convert all the aax files in a directory and convert them to a m4b format with all the metada intact. Using your approach you would have to manually set the chapters and the cover art. I have thousands of hours worth of audiobooks but even if you only have a single 10 hour book I think this approach is still the easier of the 2.

Since breaking DRM is itself illegal, why not just torrent the content?

Because they're not both illegal under all jurisdictions. IANAL but breaking DRM for personal use is legal in the US.

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