Since I got this thing working pretty good, I read about the Time Capsule. Can anyone tell me if I could easily copy my itunes stuff ( from the Passport HD ) over to the time capsule and then direct itunes to it? There is a 1TB version used I might be interested in.
I'd recommend against it. Time Capsule is designed to be primarily a wireless backup storage device, not a networked file system for regular use. it can probably work as one, but in addition to this not being its primary function you are also embedding a storage device with your wireless base station ... failure of either will make access to your data difficult. It's a nice idea for simplicity and convenience, but not the sort of solution that makes me very comfortable.
A better solution, if you want a wireless storage repository, is an Apple Airport Extreme with an attached hard drive for storage. That way, at least if your drive or the base station goes down, you have the other half of the system still operating properly.