Pandora is one of the best web-based radio "stations" for listening to and finding new music to suit your tastes. I use the web-based pandora and also use a Pandora Beyond Media HTPC plugin on my home-theater-PC to listen to music. Now there is PandoraJam, a $15 application that streams music from Pandora and then allows you to record those songs in AAC format to be imported into iTunes along with cover art and the tags you have set up. Other features include scrobbling your Pandora songs to Last.FM and streaming Pandora to an Airport Express and all of its HiFi goodness!
I kind of wonder how long this will last though. It seems that this "recording" function would be in violation with Pandora's terms of service. For this reason alone, I wouldn't pay the makers of Pandorajam a penny since they will likely be getting a cease and desist letter from Pandora very soon.