I've puzzled over a way to automate this myself. My ideas were something along the lines of a screen capture with some OCR to get the song information combined with cutting the sound stream during pauses. If using pauses is unreliable, you could possibly detect the song changes by monitoring when the song/album display changes. This happens about 30 seconds into each song, but I haven't tested whether this is consistent.
I've surfed a bit for appropriate tools for this, but haven't looked much further than that. As a side note, does building a music connection through automated recording of these channels fall under fair use? What about distribution of an application to automate this? One could build a sizeable mp3 collection just by running such a program. The potential is certainly comparable to Napster in the "pissing off RIAA" department, and possibly has a legal leg to stand on.