Catherine and I put on a barbecue this weekend, in theory it was a housewarming party, however we have been here for 16 months - so not really a housewarming. One of the things that we didn’t have to put any effort into was the music, and that was down to something called Grooveshark Lite. 
Groveshark is a Florida start up company who’s business model is basically to allow users to upload their music collection to Groveshark’s servers, registered users can download the music (at a price), of the said price a cut goes to the artist, a cut to the person who uploaded the music and presumably the rest goes to Groveshark.
The lite service allows you to stream music for free from the Groveshark library without even registering, in addition there is an auto play feature that is similar to Pandora which picks music based upon your tastes, which you identify by rating each track as a happy face or a sad face.
The best thing about using Grooveshark for the music is once a couple of people had been shown how to use it all of our guests got to choose the music, someone would come along and queue up a couple of tracks someone else would come along and rate some of the tracks, when the track listing ran out Groveshark guessed pretty well.
As far as I can tell it is a legal service, as they are sharing out the profits from downloads to artists, ReadWriteWeb and TechCrunch seem to suggest that it is legal too. The fact it is in Florida and has not been shutdown by the RIAA is also a good sign.
In summary, if you have a party give Groveshark and your guests the job of picking the music, you won’t be disappointed.