Or...
If you have multiple users setup on your machine, and each user has their iTunes library, and you set the "share my music" and "look for shared music" in each account AND each account is logged in AND running iTunes...
(phew)
Then you will see "UserName's Music" entries on the left side for each user name, which sounds more like what you are talking about. (i.e. each user has a separate library, but each user will be able to play all the music (note that you can't edit other people's music libraries)
I use this to be able to play my music in either my work or personal accounts on my powermac. It also works across the network, if you have multiple machines.
Each user DOES need to be logged in AND running iTunes though, which is a little bit of a pain, unless you tend to leave the machine running all the time...