Hm, dunno, but seems like a lot of trouble for almost nothing. I remember that back in the days we used to copy C64 tapes using a double cassette deck on the stereo rack and that worked fine.
So, I guess if I was to make C64 tapes out of .tap or .wav-files, I'd just connect the PC to a stereo / tape recorder using the line-out and a 3.5" jack->double cinch cable which costs about 3 Euro. Record the tape, and if for some reason the commo doesn't like it, try adjusting the head on the C2N using a small screwdriver. ;-)
After all, it's just plain audio noise. If the C64 doesn't mind compressing to MP3, it won't have no problem with a tape that's been recorded in a regular stereo. Besides, how do you think the audio got into the PeeCee in the first place? ;-) Just the other way round by hooking up a tape deck to the soundcard.