I’m on a PPC Mac and not an Intel version but svn1586 works fine for me with iTunes 8.1 (50) running on Leopard 10.5.6
Your problem with mounting 1696 sounds like it may not have d/l’ed correctly. I’d grab 1586 again, then run the stop/uninstall scripts and re-install the preference pane and see where that gets you. If you still have problems then maybe a reinstall of iTunes is in order though that’s a new one on me 😉