Try it out. I bet it doesn't work.
I store my rips in FLAC (lossless formats are gapless) then convert them to Lame-MP3 to place on the iPod. Since iPod added firmware for "real" gapless (previously they used an awful cross-fading technique), my tracks have played gaplessly without a need to re-rip. Before my iPod, I used a Rio Karma which supported gapless out of the box, so my digital collection has been fairly stable from the start. I don't buy downloads in other proprietary formats--only DRM free MP3, so I have not had an issue similar to yours with ATRAC.
I use a program called dBpoweramp
to rip music and one of the options is to remove silence from the beginning and end of a track, so that may be what iTunes uses to determine if a track is gapless or not. You can also use it to convert one format to another and perform the same function.
From Apple's site, however, it looks like the iPod photo does not support gapless
playback, so there may not be an easy solution to Marvin's problem with his sister's iPod. The other option is to rip multiple tracks as one or join tracks. An app like Audacity
can help with that in some cases after the fact. iTunes allows you to join tracks on import and dBpoweramp has a "rip as one" option.