Yes this has irritated me too. Surely you should be able to make coverflow on the iPod work on album title rather than artist. Lots of my albums are by multiple artists, so it's a big problem.
The other thing I find irritating is the inability of iTunes to get the artworks correct. Even if it does get it right initially, it often messes it up later on all by itself. Since when has Christina Aguilera been a large male called Charlie Hines? OK so he has an album called Back to Basics, but surely the software can be clever enough to check the artist name as well as the album title? And you should see what they did to Dolly Parton