> If the exact same recording of a song appears on two
> albums, an ideal categorization system would allow it to
> appear as such without storing multiple (redundant) copies
> of the song.
This means that in my iTunes library I currently have seven copies of Don't Fear the Reaper. Three of these are copies of the studio version. Incidentally, I hate this song, and though I think you're right and I should have two copies of the song, I can't help but react with mild revulsion whenever I realize I'm going to be hosting yet another copy of it.
Again, I think you're right, and it's not particularly meaningful to worry about the extra ~100 MB of space they're taking up (ALAC format), but it's an annoyance.
Deduplication should be done by algorithm that detects that it is same binary copy -- not through tags.