The NowPlayIt business model is very interesting. And I think that the $8 price point might be about right, if not a little low.
Think about when someone buys a songbook…most of the time, the individual is only after a couple songs, which means that they paid between $10-$25 for each song they were after.
Then look at learning the song from the artist his or herself in a more personal and convenient format than just buying a book.
And as for the black markets, you are absolutely right. Copyright violations are already exceedingly prevalent in the music industry. NowPlayIt just gives the market one more thing to rip off BUT it does create a whole bunch of value that a certain number of people would be more than willing to pay for.