Two libraries or two users

Background:
My wife and I share our computers, a G5 iMac and a 7 month old Macbook (used mainly for traveling) which are used both for personal and business( she is a singing teacher).
Currently we only have one user account and I handle much of her business affairs on the computer. Thus there is only one iTunes and one library mainly with my personal music (about 20 to 30 Albums).
She would like to take her extensive CD collection of 300 or so Albums, import them into iTunes arranged them into various categories or playlists, and then sync them to an iPod so she can clear her studio of all these CDs and access them via the iPod. However, I would like not to mix her 300 CDs with my 30 or so.
Question: What is the best way to do this?
One solution is to have a second User account with each having a separate itunes library. Ideally, I would have the second User account as it would take a very long time to import all those CDs and we would need access to email as students ask for lessons, cancel lessons and change lessons all the time. So if my iPod is sync with my stuff on the main User iTunes, can I import them from the iPod to the new User iTunes and then delete them from the Old ITunes user account in preparation to import her CDs?
Or would it make more sense to just create a second iTunes library in the same User account and just have two libraries? Would they keep separate and not have duplication and how do we go from one to the other?
I apologize for the long winded question and am looking for some advice on how to proceed.
Jerry

1. to import music from an iPod to iTunes (iPods are not set up to be able to do this) do a Google for a utility such as Senuti
2. it sounds as if the easiest solution for you is to use one user account but have two Libraries. To do this, launch iTunes with the Option key pressed down, then Create Library.. , in a location of your choice.
3. Once you have two libraries, you switch between them by launching iTunes with the Option key pressed down, then Choose Library.. by pointing to the relevant iTunes folder. There will be no duplication between the two except for whatever you choose to Add into both.

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