Copyright Question - two ipods with iTunes Music

I apologize if this was answered in an FAQ or some other obvious place. I have googled around and can't seem to find the answer.
I have just purchased my wife an iPod for Christmas, making us a two iPod household (including mine). Until this point my wife and I have shared music CDs. She would keep one for a bit in the car or at the house and after a bit I would take it and listen to it in my car, at the gym etc.
How do we do this with iTunes? If I purchase an Album on iTunes, can I listen to it for a while on my iPod and then somehow transfer it to her account for her to then listen to for a while on her iPod? Does the copyright regulations of iTunes allow for sharing music around on different iPods?
Thanks in advance for any assistance. We do try our best to stay legal on all fronts in the digital age!

Thanks for the speedy answer to a newb! So far the wife and I are LOVING our iPODs, and due to the quality of the nano Gen4 (they are SOLID) are considering our first MAC purchase (heck I have wanted to go MAC since Windows Me )
Just so I understand, if I copied the iTunes my wife purchased onto a thumb drive, then put the drive in my PC and opened itunes and did Add to Library, I could then select that drive and import them in? And I could then sync those iTunes to my iPod?
Thanks again!!
Message was edited by: faamecanic

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