As a disclaimer I don't use an iPod or iTunes so I might be making this up as I go along:
>1. You can use your iPod with other software.
Do people really do that? I was under the impression that if you have an iPod you really only ever use iTunes. Since iTunes is the only way to update an iPod you have to at least have it installed so using something else to manage an iPod doesn't sound like something most people would do. Not that there's anything wrong with that, iTunes is a superb app from what I've heard so there's no harm in bundling it as it gives the consumer what they want (good media app with good iPod integration).
>2. With the exception of older DRM'ed tracks, you can put your music from iTunes on any device with any other software that supports said device and the proper file formats.
I know a lot of people stuck with those old DRM'ed tracks who are too cheap/lazy/ignorant to update them. If you use iTunes, "Everything Just Works(tm)"
>3. Palm is taking the lazyass way out and piggybacking on iTunes when anyone with three braincells could see this leapfrog coming a mile away. Yes, Apple is being dickish about this, but Palm damn well knew this would happen and they have a lot more to lose from pissed off customers than Apple does. The iTunes library is just an XML file. It would be trivial for Palm to make an app that reads said file and syncs without the need for iTunes to be running.
This is certainly true, writing their own sync application would probably cost less than the lawyers they have on retainer preparing for the eventual Apple lawsuit. This is probably more of a press battle than anything else and Palm is playing it pretty smart by staying in the public eye with this. Apple looks bad for deliberately locking them out and Palm looks technically savvy for coming up with another workaround. For everyone I know with an iPod though, iTunes is The Music App. I used to see the same thing where IE was The Internet. If you have to use something else it looks like a kludge to end users so integrating with what they already know and use is a win for consumers.