It uses soundManager for cross browser audio handling. It first tries with flash and fallbacks to html5 if flash is not available. Firefox with flash disabled wouldn't support mp3, and thus won't be able to play it. I am using SoundCloud api only to fetch streams.
Hmm, that's odd, I'm using Chrome 19.01 and have no other plugins running asides FlashBlock. Once I disabled flash block everything ran fine. Does this version of Chrome not support the HTML5 fallback?
I'm using Chrome 20.0.1116.0 (canary) with the plugins blocked by default (play on click) and I'm getting the same error. Also the usual 'run all plugins on this page' option is not there.
It doesn't seem to work in Safari with click2flash, either. Possibly because click2flash doesn't actually disable flash, it just requires a click -- but there's nothing to click on.