iTunes - Two Users

Maka a user account for each kid and they'll have separate iTunes libraries (and home folders, for that matter).

System preferences -> Accounts.

Additional tips: iTunes: How to share music between different accounts on a single computer

 

iTunes 7 also has some built in features to allow you to switch between two libraries on the same account.

http://www.yista.com/bhaugh/switch-between-two-itunes-libraries-multiple-methods/

 

Why not just make 2 different playlists? I'm assuming that having 2 separate libraries, if done (in)correctly, will result in 2 versions of the file.

This would also be easier if the Mac is not already set up with different user accounts.

Just have a playlist for Lisa, Bob, and Sam, and set it up to sync with their respective iPods.

Now, if someone can tell me how to play the music on my iPod on another computer, I'd be a happy camper!