ITunes 8.0 - damaged library (.itl) file

Help!
Last night I downloaded iTunes 8 (8.0.1 I believe). The first time I opened iTunes, it created two library database (.itl) files. One is now called "iTunes Library (damaged)" and the other is "iTunes Library." The damaged file seeems to be unusable. I guarantee all of my music is legit.
What I find is that iTunes now only contains a third of my music. All of my music is still on my PC, and my iPod is fine (though it still has the old data as I don't want to sync it until I hopefully restore my library). It's only the .itl file which is somehow corrupted or missing data.
The question? How do I restore my library? Can I get it from the iPod? I have spend years categorizing my music and I have 4,000 songs. Recreating the genres, ratings etc. would take days.
I run Windows Vista on a PC.
Thanks so much for any help.
Andrew.

If it keeps happening, it will probably happen when you go back to v7.
Check your security software - something is preventing itunes from saving the ITL/XML library files properly.
Norton is a very bad culprit for itunes upgrades on not saving previous settings that allow itunes.
Other typical reasons for the ITL/XML not saving properly are
1) 3rd-party plugins for itunes that share the itunes XML file
2) Vista permissions have gone wonky and you no longer have full control over your music folder & its subfolders

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