I know this is a massive thread mine, but I think it is important that I post the solution I found to this problem.
I had exactly the same issue - I moved my iTunes music folder and music library file to a custom location on another hard drive.
PS3 Media Server was no longer able to find the file, and therefore I couldn't access my iTunes library on my PS3.
So what I did is this:
I created a symbolic link from the old (default) location to the new (custom) location of the iTunes media library.
In Windows 7, open up the Command Prompt as an Administrator (right click, Run as Administrator).
Navigate to the old (default) location of the iTunes media library. (Usually C:\Users\*your user name*\Music)
Type this command: mklink /d "iTunes" "*new itunes library location*"
For example, if you now store your iTunes files on your F: drive, in the folder All My Music, this would be what you write:
mklink /d "iTunes" "F:\All My Music\iTunes"
You should get a message saying the link creation was successful.
Then restart your PS3 Media Server.
I believe this is also possible in Windows XP / Windows 2000, and also Mac and Linux on that note, but you'd have to Google the commands.