You were misinformed.
Normal installation mode for Snow Leopard replaces only system files and leaves applications, data and settings as they are.
To erase and install, you have to deliberately erase using Disk Utility on the installer disc.
You should always have a full backup of your system in case of HD failure or serious finger trouble. It would be wise to backup your Tiger system to an external drive using CCC or SuperDuper to produce a bootable clone. That way all your data is safe if anything goes wrong.
I do not recommend using your iPod for this; an external HD is a lot safer.
If you're using a retail SL disc, there is no iLife package with it, so if you want to retain iPhoto, iMovie, iDVD and GarageBand you'd be best to do a normal install.
Ensure you select Rosetta from the custom install list - your older software won't work without it.
The installer will replace the Tiger system files with SL ones and should not touch any of your data or settings. Note that the restart will take considerably longer than usual as files are moved from a temp folder to their correct places in the system.
Caveat; I've done 8 of these now, but two wouldn't install until I erased the Mac HD volume. No idea why the difference, but it does make that cloned backup important.
Be warned that printer drivers, and scanner drivers in particular will almost certainly need updating for SL. That could be a problem if the printer or scanner is more than a couple of years old.
Many third party applications (and some Apple ones) may need updates for SL (Adobe particularly), so check with the vendors for compatability before you upgrade.
There is no Classic in SL and no support whatever for OS9 and earlier applications.
If you still wish to save only the iTunes stuff, just drag the entire iTunes Music folder (iTunes Media in later builds) to your external HD and drag it back to replace the new one after installation. Start iTunes with the opt (alt) key held and choose the iTunes Library from the folder for it to use.
Once again, I wouldn't risk your only copy of the music to an iPod. If it syncs on startup, you risk losing the lot.