Nope....the keep 10 are truly yours to keep. When you're given your allotment each month, you get the option of using a song credit, or zune pass when you download songs. The song credits (as well as regular purchased content) are most often downloaded as mp3s at 256kbps or 320kbps.
Only the zunepass content (drm protected wma files at, iirc, 192kbps) will fail to play when the license ends.
Gotcha, that sounds good as I am leaning toward getting a WP7 when they drop.