If I have an ipod that I sync regularly to my itunes music on my hard drive (and I have everything sync), is this an effective backup of my music? If my HD happened to crash (saying during a Tiger install) would I be able to recover my music from my ipod (including purchased music from the itunes store)?
You should definitely backup music you purchased from the ITMS to CD-ROM. But for the music you have ripped off your own CD collection, there are apps, such as Senuti, that allow you to go iPod > iTunes.
Beware - if you sync to a machine, the iPod takes what's there, it's not a true "sync", more of an upload. If you lose your music for whatever reason, don't sync your iPod until you pick up a third party app that moves songs the other way (like Senuti, mentioned by macsackbut).