I haven't heard about itunes 8 causing problems all over the place. Some Googling shows me that you are correct. But the problems appear to go away if you open up your firewall (if you're even using one) to allow iTunes traffic. Apparently there's also another issue for those who have not updated their Airport Extreme firmware. So you'll want to do that.
http://www.macnn.com/articles/08/09/10/itunes.8..airport.express/
But man, the Genius feature is awesome. You just pick a song that represents how you feel right now, press the Genius button, and hit Play. Instant playlist with songs from your library that go well with that song.
Dave Howell, Avatron Software, Inc.