I wasn't imagining things - Ping is connected to Facebook, it's just that Apple has pulled the iTunes-side UI out. I just went to my Facebook account and saw this:
Which is exactly what TechCrunch is reporting:
When I first loaded iTunes 10 yesterday and started up Ping, connecting with Facebook was the first thing I did to find friends. At first, I will say that it didn’t work. I hit the Connect button, entered my credentials, and nothing happened. But I tried again and it worked perfectly. I found a handful of Facebook friends who had just started using Ping as well and connected with them.
So I guess Apple and Facebook are still talking about stuff...