ITunes Sign In To Use This Computer / iTunes crashes / iTunes restarts

I have been having this problem on and off for a very long time now, through at least one major update of the iTunes software. I recently purchased an album from the iTunes store and the problem has returned. I've searched the forums for advice and got a lot of very weird advice. None of it helped.
The problem is: when I start my MacBook Pro (12 months old, all OS patches installed 10.7.3), iTunes 10.6 starts then request that I "Sign In To Use This Computer for Automatic Downloads." iTunes does not recognize my password; displays a slightly different dialog screen that says "Sign In Required," then back to "Sign In To Use This Computer for Automatic Downloads," which repeats and repeats then switches to the other dialog "Sign In Required," then back to "Sign In To Use This Computer for Automatic Downloads," et cetera. If you cancel out, which it accepts after hitting cancel three times, then navigate to the iTunes Store, the iTunes Store starts to load, then iTunes crashes, asks you if you want to send a report to Apple (I've personally sent at least a 100 of these already), then iTunes restarts. You can't kill it - if you force quit, it restarts immediately.
Any suggestions other than Authorizing / Deauthorizing / Deleting the SC Info Folder?

I have this same problem iMac Lion 10.7.3, iTunes 10.6.1(7). Any ideas what I can do to stop it?

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