What frequency is timer2 running at?
analogWrite(10, analogRead(A0) >> 2);
OCR1BL = analogRead(A0) >> 2;
I don't think you'll manage to modulate like that any meaningful audio signal, do you?
8bit R2R DAC can generate decent sound and you should definitely make out the sounds and words.
No the contribution of the most significant bit must be as accurate as the least. Because 0111 1111 must be lower than 1000 0000
@OP, you still haven't told us what you really want to do
You can synthesize upto 16 bit accuracy from 2 8-bit PWM signals and two accurate resistors in the ratio 1:256,which hasn't been mentioned on this thread yet.
But you can also combine two 5 bit PWMs to get 10 bit, and 5 bit PWM can run a lot faster for easierlow-pass filtering on the output.