While it is still possible to play music, other important functions like sync'ing your iPhone/iPad does not work.
I initially tried rebooting, then re-installing iTunes, but that didn't work.
Then I took the lazy way out, and simply Google'd. Surprising, as of Aug 2014, there were no solutions within the first two pages.
- there was someone who claims to get a new top-of-the-line iPhone 5s free by complaining to Tim Cook. Feel free to try it!)
- there were the usual long/complicated/convoluted steps that may appear to have helped one or two but didn't fix the problem for (most) others.
So I started my "hard-work" of finding a solution on my own. And the "hard-work" took all of 5 minutes before I lucked-out on the solution that worked for me. And it was really really simple.
- Close iTunes (it may hang or refuse to close, in which case you need to "End Process" using Task Manager if you're using Windows, or "Quit Process" using Activity Monitor if you're using Mac OS.)
- Delete your album artwork cache folder. (Or back it up by renaming the folder.)
- Start iTunes
The location of your album artwork cache folder depends where your iTunes files are, which in turn depends on your Operating System. You can refer to the official knowledge base article from Apple on how to find your iTunes folder. But unless you used customized settings, it can usually be found at:
- Mac OS X: /Users/username/Music/iTunes/Album Artwork/Cache
- Windows XP: C:\Documents and Settings\username\My Documents\My Music\iTunes\Album Artwork\Cache
- Windows Vista: C:\Users\username\Music\iTunes\Album Artwork\Cache
- Windows 7: C:\Users\username\My Music\iTunes\Album Artwork\Cache
- Windows 8: C:\Users\username\My Music\iTunes\Album Artwork\Cache
Remember to substitute "username" with the appropriate name you used, eg. "C:\Users\smith\My Music\iTunes\".
Hope this helps!