As an iTunes apologist and power-user since 1.0 (my huge library admittedly is not helping), 12 has become the last straw on using iTunes as anything but a sync tool and database. As a media player, it's a disaster.
Good to know I'm not the only one. I've become used to scrubbing the pointer up and down over the list of podcasts until the part I'm looking at is legible, and plugging my iPod in twice to get it to show up. But IMO iTunes is actually one of the less-bad recent Apple software screw-ups. At least it doesn't have enormous memory leaks, like Safari and Keynote, which regularly beachball my poor laptop with "only" 4GB of RAM long enough to go make a cup of coffee.
I would argue the peak in bug severity was 11.0, which randomly deleted podcasts: https://discussions.apple.com/thread/5324634?tstart=0
For me that meant 30 GB of podcasts gone, most of which I can't download again (publisher went broke, original download required payments etc.) Sigh. I used to be a big fan of iTunes as well.
The bloat is probably integration with the store. That should be split into a separate program and iTunes should just be a music library manager. Of course, that won't happen since not many people care about having a persistent music library any more.
Additionally, it is a LARGE application just for playing audio. I know that it does other things too but it seems to have outgrown its original purpose? There is now a crossover between iTunes and the App Store on Mac, from what I can tell? I wonder why they don't merge.
Having said that, I like the glaring red icon they now use (not sure why they changed from blue though!)
In addition to what other have said:
* no support for FLAC, OGG, WMA(?)
* I don't _think_ there's support for ReplayGain.
* Frankly, I just find the UI hard to manage.
* _any_ marginally advanced feature.[1]