To reduce the mp3 size i'd do it in an external program like
the freeware Audacity, or inside flash in the File->Publish
To reduce the volume of the sound on the timeline, select the
frame where the music starts, on the properties panel (usually at
the bottom) select the edit button next to effects, at either click
in the channel boxes to create the fade out, or use the predefined
Best if you have a play about with adding the fade out
manually to each channel to get the effect thats best for you.