Nothing else extra going on in the background. Tried after rebootin the phone, and same behavior. All I need to do to overcome this bug is go once to the preferences window and choose WAV as the preferred format and then change it back. It feels like the the codec choice is empty when the app starts (it shows the AAC, maybe because it cant show empty field) and I have to go and make one choice to get it working. After that it works as planned. I'm not sure if anyone else has this problem, it might be just my system and if it is, I think it is not worth investigating further.