Wow... this sounds exactly like what i've been googling for!!!!
I'm pretty much in the same situation - forced to use iTunes to sync my Touch, but everything else is MC. For now, i've been manually inputing Ratings from my Touch into MC... ugh. For getting MC ratings into iTunes, i've just avoided it.
I'd be curious to know how play counts sync up, though. Assuming i 'sync' the libraries, then play a song in MC, play that same song on the Touch (and then sync it to iTunes), both playcounts would be +1. The 'correct' playcount should be +2, though. Does your app can determine the playcount since last library sync (ie, the net change of +1 to then incremental MC's playcount), to keep them accurate and synced between the two libraries?
Also, if i have a song rated 4 in MC, but 3 in iTunes, how does you app determine which to use when syncing the libraries? Is there a default whereby either iTunes or MC has priority? Or maybe i'm missing something...
Sounds cool though, nontheless...