The terminal is a good way to get those songs off, I'm also under the impression that as long as you have a password for your purchased songs, you'll be able to play them. Am I wrong?
Also, you can try a tool like Tinker Tool to show hidden files, then you might be able to copy the songs off your iPod in the finder.
Then, in iTunes, all you need to do is re-import the songs into your library and tell it to organize them and it will rename them all for you from the stupid iPod names. This is how I copied my Windows mp3s from my iPod to my Mac.