I like to keep my music switching pretty smooth. Is there any option or third party thing that anyone knows of that allows me to play one song, then have it quickly fade instead of a hardcut into the next song on command when switch songs manually?
I don't think that there is an app that exists to do that. And I don't think that one will be written to do that, because the apps that are written with the SDK are only allowed to access there own files, in other words they can't have access to your music.
cause in itunes you can turn on the crossfade playback in the music preferences which starts the next song twelve seconds before the previous one is done. so both songs would be playing at the same time for 12 seconds which might be a nicer transition for you