As i understand it, the iTunes server is mt-daapd 0.2.4 which is pretty old & primitive.
The latest versions are known as Firefly and it has its own web site.
The problem at the moment is that the web based admin page for mt-daapd 0.2.4 is integrated into the ReadyNAS firmware because it didn't have its own web interface at the time. Newer versions of Firefly have a web interface.
Infrant provide a bin file so that you can upload Firefly 1.0 BUT the original web interface remains & if you use the original you end up corrupting the config file & the iTunes server stops working.
Firefly can create playlists. You can't create complex playlists but it can do smart one's based on meta tag info & stuff.
It can also read a copy of the iTunes Library file (the original is always on the PC) & therefore use iTunes own playlists and/or read .m3u type playlist files.
Infrant has implied that firmware rev 4 will improve things somewhat, but we're still reliant on Infrant providing newer versions & they don't provide any of the beta versions of Firefly.
As i said, this is my understanding of the situation.