Same issue here on Win XP SP3, and found it to be caused by Integard by Race River.
No iTunes store and 100% CPU usage between AppleMobileDeviceService.exe and iTunes.exe.
Disabling the Integard service from starting up, running netsh winsock reset and restarting PC and all was right as rain.
As soon as I start up the Integard service, iTunes is broken again.
Even tried adding the following to the list of programs with no restrictions:
AppleMobileDeviceHelper.exe
AppleMobileDeviceService.exe
distnoted.exe
ipodservice.exe
itunes.exe
iTunesHelper.exe
mDSNResponder
but it didn't help.
Even disabling filtering by Integard didn't work, I litterally had to disable the service from starting up.
For now I've reverted to 10.4.1 until it's sorted.
Strangely for my laptop running Windows 7 64bit, the update to 10.5 went without a hitch and has nos issues - the laptop is not running Integard though.
At work, running Windows XP SP3, the update failed and I had to completely uninstall all Apple product and then ran CCleaner to clear the orphaned registry entries. After that install worked fine and no issues with iTunes sore or CPU usage.