Keep in mind you can only burn to CD once for each book. If you have trouble creating the CD for any reason, you might be able to contact customer service, but otherwise, it's a one-shot deal.
Audible's Help recommends not using CD-RW, but the reason it gives is only because not all CD players will play CD-RW. It doesn't say the quality is affected for any reason.
EDIT: Hmmm. The
page on burning to CD using iTunes DOES say that CD-RW isn't recommended for quality as well as playback issues. You'll have to decide, but my point in mentioning the one-time-only rule is that you can't experiment and then decide to try the other way. If you want to experiment, download one of the freebies that you don't care about!