Correct me if I'm wrong, but iTunes is just a file management system. All of the actual files are on your computer somewhere and iTunes locates those files, organizes them, and then transfers them to your iPod.
So if your iPod gets wiped, you just plug it into your computer and re-download everything via iTunes again.
If you have new songs to add, just plug in your iPod and iTunes will sync it with the new files on your computer.
Question: If I rename/edit a file via iTunes, does it rename/edit the original file on my computer or do I have to rename/edit every time I re-load iTunes onto my computer (e.g., after a Windows reinstall)?