you can centre the window but it's not quite fullscreen
If you hold down ALT while clicking on the green button, it centres the window and scales it to full screen with about a 30 pixel gap around the window.
That's closest to full screen iTunes can manage without you manually dragging the window to full screen yourself.
I think it's more of a "Way Mac OS X scales windows" than iTunes thing. I still think OS9 had it's good points when it came to maximising a window to fullscreen properly.