Not sure what you mean when you say you want to integrate them with iTunes. You can either have all four contain the same content by syncing to the same playlist, or have have each one contain different content by syncing to different playlists.
As for MP3, yes, iTunes does MP3. For ripping discs to MP3 go to Preferences > Import settings and select MP3 Encoder.
A quick google search will give you a plethora of free apps that allow you to siphon off the content of your iPod to your computer. I don't have any particular recommendations.