@JimH:
I was using 12.0.10 when I posted this, now I'm using the latest build, but the options didn't change a bit. Should there be such an option? Forgto to say, I'm using MJ by the way not MC. Sorry about that.
@JustinChase
Well it is possible to convert "images" but I guess that only applies when transferring images explicitly and not to cover art which might even be embedded in the tag.
By the way,
here's a video of how my iPod behaves at the moment. coverflow is not usable, the rest is annoyingly slow. I think it's because the ipod has to scale down all the covers all the time. I'd like them to be converted into the native iPod cover art resolution (I guess 80x80 or something) OTF when transferring.
Comments for the video:
1. Changing from {Genre} to {Artist} takes 5-10 seconds (as demonstraed with Deep Purple and Elvis)
2. Changing into coverflow takes 20 seconds (display turns off)
3. Playing a track takes another 20 seconds (display turns off)
4. Going back to cover flow induces 60 seconds of freezing. After that I'm back to playing now. The only exit is a reset...