They removed the color icons in iTunes 10 so that it would be like the iPad’s iPod.app. It’s as simple as that. We already know they consider the iPad’s iPod.app to be iTunes on the iPad. Jobs even mentioned that it was written in Cocoa unlike iTunes on the Mac.
The problem is the grayscale icons work on the iPad because the iPad’s iPod.app focuses specifically on audio (music/podcasts/audiobooks) and you’re not going to have as many playlists and other content types (Books, Radio, TV Shows, Movies, Ringtones, etc) as you would on iTunes. Other content types are played back within their own unique application like iBooks or the Videos.app.
iTunes on the desktop is a different beast.
You have your library with music, movies, tv shows, podcasts, iTunes U, books, apps, ringtones and radio, the iTunes Store with Ping, purchased (“Purchased”, “Purchased on Apple TV”, “Purchased on iPad” and “Purchased on iPhone”) and downloads, your synced devices (four in my case — Apple TV, iPhone, iPad and iPod nano), the Genius feature with Genius Mixes and individual Genius playlists, iTunes/home sharing and two different types of playlists.
There’s too much going on there not to have some sort of color differentiation. The lack of color icons even hinders iTunes sharing since you can’t tell the difference between just a “shared” iTunes library and a “home sharing” iTunes library that allows you copy iTunes content between computers.
To top it off, they changed the “stop light” orientation so that it doesn’t conform to OS X’s own UI guidelines and grayscaled the application preference pane icons so it looks like a window that’s in the background.
Now, they’ve put Ping links everywhere and removed the Genius bar and iTunes Store links. It’s getting silly. It’s almost like they’re just trying to screw with users at this point.
iTunes 10 is a just a mess.