I think returning a tags item is a good idea since it’s the most general, and clients can then be configured to treat certain tags as first-class citizens, or just display them as a key/value set. What might also be interesting is a new getByTags endpoint that retrieves all albums/songs that have a given tag (key=value) present. This could be used by clients to e.g. make the LABEL tag browsable, allowing a user to get a list of all albums released on the same record label (assuming their library was tagged as such, of course!)
The tags item could be returned as part of the album element to save data, IF all of the tracks in the album had the same value for a particular tag. Tags that were different per track within an album could be attached to the track element instead.
I guess a getTagValues endpoint would be a good idea too then, which returns all the values for a given tag in the library. So a client could present a list of composers by getting getTagValues(composer)