The quick answer to your question is no, for example Home Sharing works over Ethernet as well. Strictly speaking Wi-Fi is not required and iTunes doesn't care either way.
However, I understand that the Devolo mains adapters have problems coping with this. If I had to guess, the problem might be an inability to carry the required bandwidth. The reason for this is that Airtunes is fairly demanding of bandwidth and if your wireless network's performance is degraded due to any number of variables, Airtunes is the first to suffer.
You didn't say what kind of computer or OS you are using but Home Sharing uses TCP port 3689 and UDP ports 123 and 5353 to communicate with shared iTunes libraries. Those ports need to be configured in whatever firewall or security settings you may be using. If you are certain you have those ports open on your shared computers then concentrate on the Devolo adapters. Perhaps they are in need of a firmware update or modification of some configuration setting.
John, thanks so much for your swift response.
So my hunch was wrong re home sharing working only over wi-fi. The Devolo boxes appear to be working extremely efficiently with a communication speed of over 100Mbit/s between them - so in terms of speed, the network seems not to be degraded (although I realise you are querying bandwidth, not speed). I'm using Lion on all Mac devices, IOS 5 on phones and ipads. I have no PC devices.
As far as I understand the network, the Devolos are acting only as 'dumb' access points and there are no firewall settings on them. Which I guess leads me back to the router (as BT business home hub). Perhaps I need to configure the port access you mention on that?
Yes, the next step is to determine if your router is preventing Home Sharing from working. Without an Apple Base Station, it's difficult to say what the problem might be. Apple rather unhelpfully says your router "needs to be up to date" whatever that means.
This may be helpful: Troubleshooting Home Sharing
Given the proper port access and barring anything with the BT router preventing it, Home Sharing should work.