It's still a grey area. You want to make sure that you don't play an ENTIRE song of a copyrighted artist. Of course if you play like a 10-second clip, you will likely get away with it, especially if you don't get too popular. There are terms where you can use copyrighted material under what's called a "Fair Use" clause.
Here is a quote from
http://www.menc.org/information/copyright/copyr.html that I was directed to when I had a similar question:
"Fair use, which applies to all users, allows certain uses that would otherwise be illegal infringements of the copyright owner’s rights. For example, limited quotations of an excerpt from a work in a review or a news report are generally seen as constituting “fair use.” Fair use may also be found when the use is for purposes as criticism, comment, scholarship, research, or teaching. There is, however, no simple black-and-white test. The Fair Use provision of the law sets out four factors a court must consider in determining whether uses for these purposes may be judged “fair”:
Purpose and character of the use—(e.g., commercial or educational?)
Nature of the work—(epic poem, song, limerick, novel, opera?)
Amount and substantiality of the portion used—(how much is being copied and how important is the copied material to the work?)
Effect on the potential market for or value of the work—(is the monetary value of the work hurt by the unauthorized use?)
So the key things you want to ask yourself are:
1. Is this for commercial or educational use?
2. Is the effect on the potential market for this music going to be positive or negative from you podcasting it?
The other alternative is to use "PodSafe Music". Certain artists have given permission for podcasters to use their music just as long as they are given proper attribution. You can learn more and join up with the Podsafe Music Network at
http://music.podshow.com
http://phobos.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?id=74837876&s=1434 41
15" Powerbook G4 Titanium Mac OS X (10.4.6) 
