I have to be a little technical, but if you can handle LiveJournal, you can handle iTunes.
A few definitions:
File types. The songs on a computer may be stored in many ways. Here are the most common for iTunes.
AIFF (Audio Interchange File Format): CD quality audio. A lossless format. That is, you don't lose any information (sound quality) using this format. This format will create the largest file.
MP3 (MPEG Layer 3. Basically, you're making the soundtrack to a video). A compressed format. You will lose some audio quality but the file will be much smaller. The small size of the file is what has made this format the standard.
AAC (Advanced Audio Coding), sometimes known as M4a. An Apple compressed format. Any iTunes or iPod should be able to read and play these files. Like mp3s, you will lose some audio quality but the file will be much smaller. The advantage of aac over mp3 is that aac was specifically designed for this purpose. Aac files can also contain pictures and movies, making it ideal for podcasting and/or video iPods. It tends to be a better compression (that is, the sound is better and the file smaller) than mp3, but won't work if you don't have iTunes or other Apple software.
Files using these methods will have the extensions ".aiff" or ".aif"; "mp3"; or ".aac" or "m4a" respectively. Capitalization doesn't matter for these purposes.
Importing and Exporting
Getting files into your computer. I will, for the sake of a short article, only deal with getting files off a CD and putting them into iTunes, and then taking the files and burning them onto your own CD.
Importing (or Extracting or Converting): Files on your CD are in aiff format. You may extract them to your computer in any format. The tradeoffs are as above: Importing a song in it's original aiff format make a larger file (and your hard drive will fill up more quickly) but the sound quality will be better, and you will be able to burn a CD with no loss of sound quality. Importing a song as mp3 or aac will make a smaller file (easier to send via e-mail or download off the net) at a loss of sound quality.
You can extract a file already in iTunes. If you have an aiff file, you can convert it to mp3; if you have an mp3, you can burn a CD which requires aiff. See below.
Exporting (or Burning). iTunes makes burning a CD remarkably easy: You push the "Burn Disk" button on the lower right (see Part II). (There are other ways to do this as well.)
There are two types of disks that we will deal with here: Audio CDs and mp3 CDs.
Audio CDs (which will work in all CD players, DVD players and virtually all computers) use aiff files. They ONLY use aiff files. Starting with aiff files will burn a sound file with no loss of data (that is, it will sound the best). In your playlist (see Part II), the number of songs, time and space is listed at the bottom of the window. Generally speaking, you can get about 1.2 hours, just under 800 MB of files. More than this and iTunes will not let you burn an Audio CD (or warn you that it's going to burn more than one).
If you're burning an Audio CD from mp3 or aac files, iTunes will convert those formats to aiff as its burning. This will work just fine, but you may not be able to predict just how large the files will be.
To burn an Audio CD: Under the iTunes menu, select Preferences, select Advanced on the icons at the top of the window, and select Burning from the three choices and click the Audio CD radio button. This is the default, so don't be surprised if it's already selected.
Navigation note: Future instructions will use a bit of shorthand, so the above will be notated:
iTunes --> Advanced --> Burning --> select Audio CD
Important consideration: After you've burned an Audio CD using iTunes, the CD will appear in the left pane of iTunes with the CD name and track information. This information only appears on your computer. The CD will play on another computer, but file information is not part of the aiff format.
More on Audio CDs later.
MP3 CDs (which virtually all computers can read, all DVD players and most CD/car stereos made in the last few years) use mp3 files. Probably aac files as well, but you're then limited to computers with from Apple or with iTunes. Mp3 CDs can hold a LOT more songs, but you'll lose some audio quality and you probably can't play them on your stereo.
The mp3 format includes file information. That is, the name, artist, album etc is carried on the CD along with the song itself. Any information you see on your computer when you burn the CD will appear in the iTunes of someone else's computer, and much of the information will be available on any mp3 reader (the name/grooup/album will be in your iPod).
The aac format may include even more information, such as links and pictures, as long as they were part of the original file. That's why aac is used for podcasting and such.
To burn an MP3 CD: iTunes --> Advanced --> Burning -- select MP3 CD.
Update: Part II: Extracting music from a CD into iTunes --A. Where do the track listings come from?