It sounds fine on the scanner at home, it's an analog system used by many cities around Toronto. Their radios aren't the greatest to begin with and are in the process of being upgraded but for the most part I can't understand why some people hear it great no matter where they are, and some people seem to be having difficulty. I listen to it at work no problem, on my iPhone when the earplugs are in but not on the speaker. I'm using SimpleCast at 56kbps 24.0Khz, maybe I'll try and play with it today or see if another problem works better.
I listened to your feed. The problem is SimpleCast.
I have both SimpleCast and ScannerCast here on my two local feeds and ScannerCast kicks major butt. I am driving SimpleCast with my BC780 because that's the only way I can send channel tags, but I can't increase the audio anywhere near full deflection on the level meters or it distorts the peaks exactly like your feed. I knew it the instant I heard it on yours.
It also sounds like you are taking the audio out of the speaker output of the scanner or receiver. Is there a line output on it? If so, use that.
In any case, switch to ScannerCast and be happy. Peter made a version custom-tailored to RadRef feed providers. If I had a way to get the BC780 channel tags into ScannerCast I would drop SimpleCast like the red-headed stepchild that it is. It's a piece of garbage, crashing periodically on me for no discernible reason. ScannerCast is rock-solid.
If you can insert an automatic gain control in your audio chain between the receiver and the encoding computer that might compensate a little bit for the wildly disparate audio levels on the police radio, but if they have crappy audio it's too late for you to improve it. Just hope their upgrade is done properly.