I've been using Propellerhead's ReCycle 2.1 to chop stuff up. The auto-chop function alone makes it a godsend for ALL 500 users. It really helps take the edge off - manually working with a large number of chops without any kind of visuals is enough to make your head spin sometimes. The $199.00 price tag is a little much, however, if you ask me. I think they know we'll pay for it because it has the potential to be so helpful.
BeatButcherMPC is used for chopping - also has patched phrase editing.
FREE
http://www.beatbutchermpc.com/beatbutchermpc/Audacity could probably be used just as well for chopping/editing/recording. It's pretty good for basic sound recording & audio editing application.
FREE
http://audacity.sourceforge.net/GoldWave v5.58 is another free program similar to Audacity. (They just released the v5.60 Beta as well)
FREE
http://www.goldwave.com/MPC Maid is great for making programs on the fly. I just prefer to make them with the machine--call me old-school

. I don't feel that making programs is really a big problem on the 500. Either way, it's still a really cool program and every user should at least have it installed on their computer.
FREE
http://mpcmaid.sourceforge.net/MixMeister BPM Analyzer gives you the exact BPM (beats-per-minute) of any song/sample.
FREE
http://www.mixmeister.com/bpmanalyzer/bpmanalyzer.aspNiceLoop 1.0 is an audio file converter/visualizer - specialized in finding loops.
FREE
http://www.brothersoft.com/nice-loop-237447.htmlSwitch Audio File Converter is an audio file converter/encoder.
FREE
http://www.nch.com.au/switch/index.htmlI've also heard/read a bunch of good stuff about Sony's Sound Forge Pro 10 - I haven't tried it out yet though. Currently it's $399.95 from Musician's Friend. It's a little out of my league--if you know what I mean.
Cheers! 