aldo,
My idea was much more local. I was thinking about local advertising and word of mouth. You would consult with the client in person to determine their needs, then you pick up *their* CDs and take them home to rip into AAC or MP3 and to load onto an iPod. You would have to delete all the files from your PC after the job is done. No legal issues there. They only get back their music--and you do not keep their music or transfer music between clients. You go to the store an buy the iPod and all accessories. The client doesn't have to think about MP3, AAC, 128kpbs/160kps, 15gb, 30gb, iTrip, iRock, etc.
Again, this is for a pretty small niche of people but it could work. Get a few yuppies from your local country club signed up and then their friends, wives, kids will want the same thing.
Maybe work out a deal with a local high-end audio/home theater store to outsource this service to their existing clients. That may get sticky if they are not Apple authorized dealers though.
Fees:
500 Songs converted and 15gb iPod: $500
500 - 1,000 songs converted and 15gb iPod programmed: $700
then $50 per 100 songs