SA:MP streams the same radio playlist file as listening on the website, to each listener. It just puts it through the game's radio instead of a media player. I can see individual IPs of everyone listening, so that much is clear.
I've not noticed any problems, except while listening to SafetyMoose's show (as he's already explained his problem, mine's a result of his). It does seem to be a problem with Argonath, though, as we tested other shoutcast streams from around Europe on Hess' connection and it all worked fine, some up to 320kbps.
Some investigation is clearly needed, as it's affecting users' experience.