...is that it does a p-ss poor job of embedding/associating artwork with the actual song file. I have devices from Microsoft, Sony and Creative that all understand non-protected AAC files, and each device from those makers have had album art problems with various iTunes-created and edited files, particularly when those files are MP3(!). Strangely, I've also had less problems with older song files and their artwork that were ripped with earlier versions of iTunes. iTunes 7.x and especially 8.x seem to have created the most issues with broken art on other players (makes me wonder if Apple is doing this intentionally...)
I still use iTunes to rip and manage lossy music (though I've switched back to MP3 from AAC because we have a couple of car stereos that don't read AAC), but I use MediaMonkey to embed the actual album art into the music files. I also use MediaMonkey to feed my Sony and Creative Zen X-Fi instead of using the apps that came with those players...since embedding art with MM so far all artwork shows up fine. By no means is this a great workaround, but for my situation it's tolerable.