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Unless Apple has changed the process, I have never had to enter a credit card and I buy from the iTunes store quite regularly with Gift Cards only. As far as registering with iTunes, I believe you have to if you plan to purchase any of the DRM' d music or videos. The assumption is that when you authorize an account to play your purchased content, it must have a registered name to match.
I was able to use my AIM account to register with the iTunes store. So no need to purchase .Mac! Hope this helps. 😉
 
There is never a need to purchase .mac. You need to have a name associated with the purchase whether it be gift card or other. It would benefit anyone to do it - especially if they lose the music in a HD crash...Apple has in the past give folks a 1st time bye on helping out in that situation. As far as the apprehension of the credit card - there are worse options out there to give that data to, I am not 100% sure you need to give it to them if you have a gift card. I usually just redeem the card and it shows up in my account. You can use pay pal or other optins if it must have a payment source.
 
You do have to register a username/password with iTunes to redeem a gift card. That requires a name and address for you although there's no validation to ensure that it's you.

If you're redeeming a gift card, you don't need to enter any other form of payment details. Be sure to enter the redemption code and then register - if you try registering beforehand, it will insist you enter payment details.
 
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