My iTunes is creating duplicates of playlists and hanging up. running latest version of lion, and iTunes using match and iCloud. please help. I have uninstalled and reinstalled iTunes.  deleted all library files and is doing same thing.

I am runing lion and latest version of itunes.  I have match on, home sharing on and using icloud.  my itunes started hanging up and required me to force quit.  then upon restart of itunes and restart of computer itunes would take upwards of 15 minutes to open and was using >90% of CPU and would be lagging in response if responding at all one of the playlists I had created on my ipad had over a hundred copies of the same playlist.  after repeated restarts I uninstaled itunes and reinstalled.  this didnt rectify the problem.  I assumed library file had somehow become corrupt so I deleted library files, reimported all my music and synced with genius and match.  and let the computer go over night. when I woke in morning all my music was back but I had all the extra playlists again and itunes is hogging all the cpu and was minimally responsive and hanging up after each click. 
I thought this might be a virus or something but installed ESET cypersecurity did a complet scan with no threats found.  I am at a total loss and do not know where to go from here.  I hope one of you can assist.  Thanks!

I had this exact issue.  Spent over an hour on the phone with apple support, they couldn't resolve.  Here is what I ended up doing, that worked.
1.  Turned iTunes match off on all my iOS devices
2.  Deleted the offending playlists from the iOS device they originated on
3.  Started iTunes, let it run (literally) for an hour before it became responsive.  First thing I did, before clicking anywere else was disable iTunes match.  If I clicked anywhere, it would clock for another hour.
4.  Let iTunes run overnight, by morning it had cleaned out the repeating play lists.  This got my Mac/iTunes back to an operable state.
5.  Restore iPhones from backup in iTunes.
What was causing my issue was a single playlist that was created on an iPhone, then suddenly showed up with several thousand duplicates on my other iPhone.  The culprit playlist did not, for some reason, duplicate itself on my two iPads.  Apple support seemed to think it was because the problem iPhone tried to sync the playlist to iCloud over and over again unsuccessfully, then it finally went through and populated the thousands of blank/failed playlists which then tried to propigate to iTunes and my other iOS devices.  Seems like a reasonable theory.
I have not yet re-enabled iTunes match.  So, no idea what will happen if I decide to go back down that rabbit hole.

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