This is supported, but we should probably make it more clear that the format is welcome in our notion of an 'audio group':
We recommend it because iBooks supports it and we have had no reports of issues with the file format. I have also not heard of issues in the deployment process. AAC/m4a also works well, and I understand the requirements to stay within the specs.
Thanks for your suggestion about audio playing on the timeline -- I've added your vote to our feature tracker.