The best MP3 program I've found for the Dreamcast player is MP3 DC from Blaze. It's a British software title that offers a fully functional MP3 player for about $20.

Just drop the MP3 DC disc into your Dreamcast and turn it on. After the disc is loaded, open the Dreamcast (do not turn it off) and replace it with a CD-R with MP3 files on it. Using the controller you can select the folders and MP3 files you want to play.

You can also select multiple songs at a time to create a playlist. For best results you should have the audio cables of the Dreamcast connected directly to a stereo, so you can turn off the TV while the music plays.