I am getting this too, I am sure I didn't have this issue before but has arisen over the past months, it's really annoying and I need to find an answer, as all the other threads my signal strenght is good and it plays on the other devices fine, I also have Apple TV and I will do some tests and see if it drops out on this also, this will at least identify if it's a Express Port issue or a general on through Airplay.
I'm experiencing a similar connection problem, but have not had any time-out issues.
Rather, Airplay will simply not connect with my 2nd Generation Airport Express after quit/restart iTunes 10.6.3, or waking the computer from sleep (iTunes is open). I am using Lion 7.4. Only remedy has been to restart the computer. This freeze started after 10.7.4 was installed.
I have reset the AE unit to factory specs, reestablished by connection via Airport Utility. However, same bug remains. Hopefully the next update of Lion addresses this problem.