This is what WinAmp, or any other MP3 player that can edit ID tags, is for. It's always good policy to go through your collection and make sure all the tags are correct. It's not the EMPEG unit's problem.
If you bugged a CD Ripper coder for long enough, I'm sure they might build in some feature that allows some form of compilation encoding. But keep in mind the CDDB information is very sparse; seven music styles (as opposed to MP3's oooh I don't know how many) and one track name (rather than track, artist, year, comment) is all CDDB gives you per track. You're always going to have to check the IDs manually because you're always going to get some perversity in the track name.
So play with WinAmp.
Save the whales. Feed the hungry. Feed the mallocs.
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Owner of Mark I empeg 00061, now better than ever - (Thanks, Rod!) - and Karma 3930000004550