Just wanted to add to the list of victims here. Im on 10.6.8 and running the latest iTunes 11.1. Was in the process of ripping a 1500 cd library onto 1TB external seagate drive when at about 700 rips I get a warning that my hard drive is full. Eh? I changed the destination folder to the external drive at the start of this project. Sure enough, when I check the destintion for iTunes, it's ripping to the mac hd. Had about 200 rips on there. So I re-designate the Seagate drive and rip another disc and go to check where it ended up- in this case it was a Herbie Hancock disc and it was indeed on the external drive as I planned. But wait, I had already ripped another Herbie Hancock disc and I don't see it. I check on the Mac hd- not there either. That's funny, the artwork and track listings are in my library and the disc in my "done" pile- Click on a track- cannot locate the file. I move all the Mac hd rips over to the external which is where they should have been going in the first place, check again- Herbie still gone. Restart, sign out, update, blah blah. Nothing.
I just rip the disc again and it shows up in the artist folder section like it should and I think to myself, "Wow, how lucky was I to have stumbled upon the one disc that somehow went missing." But almost before I can complete that thought I think again- "Oh no! What if that isn't THE ONLY ONE MISSING?"
Went through the whole darn library and it turns out I'm scarce about 100 cd rips. Along with a smattering of downloaded iTunes stuff which I had to delete first in order for it to be available from the Cloud since iTunes was seeing them as present in my library.
I got on the phone with Apple and I knew I wasn't going to get answers but I figured it was worth it to let them hear about it again. To me, it's not the ripping CDs that is the issue by itself since some downloaded content also went missing and in my estimation at about the same rate proportionally. It's a glitch in iTunes.
For now, I'm going to continue with the ripping project but maybe uncheck the 'Keep library organized' box and see if I have better luck. At least at this point I'm aware of it. Hopefully I can get the library restocked and then keep an active back up. I agree with those of you on here that are ticked at the principle of this issue. Really what's the point of iTunes (assuming it's iTunes that is doing this) if it can't keep your stuff intact?