We've been using iTunes here in the Chelmsford Public Library for over two years, since version 3 of iTunes. We run two iMac kiosks in the main library, one near the CD's and one for the Young Adult area and then a standalone eMac in our branch library. The main library kiosks tap into an MP3 server in my office. I purchase the CD's and rip everything I buy to MP3. Since there's actually only one MP3 around, I think I'm within our legal rights. I'm probably going to expand the iTunes idea to the PC's in the YA section soon, now that I've got a VBScript to search our iPac.
Anyway, here's a link to my weblog with some more info about what we do. http://homepage.mac.com/ckupec/iblog
I just started it a week or so ago, so it's meager, but you might get a kick out of the iTunes scripts for download. I'm glad to see you're a fellow mac user. We're few and far between in public libraries.
I'll write some stuff soon on my blog about what else I do with the Mac at our library, so check in now and then.
Chelmsford Public Library
25 Boston Road
Chelmsford, MA 01824