Joe - I don't think there's much you can do about the distortion from a worn-out LP. A bit of HF cut is about the only thing you can do at all easily, using the graphic EQ "effect", and it will obviously make the whole thing sound muffled.

The next most sophisticated thing would be to make the amount of HF cut dependent on the signal level. Tricky with Audacity, but in theory you could duplicate the track, apply complementary filters so one is high frequencies only and the other everything except those frequencies, then use a compressor on the HF only track, then recombine (just exporting to WAV mixes the two tracks). You'd have to do all that in parallel for left and right channels. In the end, and after a lot of trial and error, you won't cure the distortion, but you might mitigate its effect a bit without losing the high frequencies during the quiet bits. You might also get some frequency response oddities from recombining the filtered tracks.

Anahata