The Shure SE series are good, as are Westones. You can get Shure earphones from the Apple online store, and Westones from
RadTech, just to name a few places.
I have a pair of the cheapest Shures (SE110's) and they're good. The sound quality isn't quite worth the price, but for the sound isolation they give, I'm happy.
For all your portable hi-fi needs,
http://www.head-fi.org. They have a sub-forum dedicated to in-ear headphones.
About iTunes sound quality... on a hi-fi separates setup that cost several thousand $, I can tell a difference between 128kbps AAC and the original CD, but it is a surprisingly small difference. High frequencies seem a little bit recessed (earphones tend to suck with high frequencies anyway), but other than that, I can hardly hear any difference at all.
If you're really worried about sound quality you shouldn't be buying 128kbps iTunes tracks, you should be buying CDs and ripping in Apple Lossless.