Hi Stephan,

>I don't use a card reader but instead download
>using the cable that came with the camera and use iTunes which
>automatically downloads and categorizes and then erases the
>images on the card for me.

The idea of third party software erasing images on a memory card in the camera sounds dangerous to me. Card readers are quite inexpensive and most notebook computers and many desktop computers already have an SD Card Reader built into the machine. The wear and tear of attaching the camera to the computer every time you want to download images, added to the possibility of damaging the camera due to a shorted USB cable or a voltage spike is even less appealing.

>Since the card doesn't leave the
>camera in this instance, is it still beneficial to reformat
>the card after downloading my images?

Yes! Reformatting the card in the camera after the images are deleted using third party software would be a very good idea. It would be a better idea to skip deleting the images with i-tunes and delete them by fomatting the card.
Good Luck and Enjoy your Nikons!

Best Regards,
Marty