Having a land line does not equal having bad audio quality. Many factors about how it's used would determine if there is a loss in quality, including the encoding format and digital compression rate, among other factors. I think a T1 is used to connect the studio to B102's Terry Peak site, which is capable of sending a very precise stream if used correctly.
I'm guessing the "flat" audio you're hearing is because of one of these factors:
1. They play oldies, most of which were recorded on less than perfect equipment.
2. You're listening somewhere in the interference area between their booster and main sites. That would mean a poor signal, which in turn would result in lower audio bandwidth from your speakers. (The interference area could be anywhere between Rapid City's west side and Sturgis, especially in high locations) Q92.3 doesn't have a booster and thus would likely deliver a strong signal in B102's interference area.
3. Heck, maybe their processor is out of adjustment. It used to sound great, but I haven't really listened within the last few weeks.
Compression is how engineers can get a station to sound loud without illegally overmodulating. When you back off of the compression, than more of the highs get through, and you can't crank the audio as loud because you start overmodulating sooner. When you don't strive to be loud, than the other stations in town sound much louder and stronger than you, and you could lose listeners. It's a tough balance to strike between compression/loudness and purity.