Project Gutenberg and Open Textbook are very interesting sources of copyright free e-books. I downloaded Henry IV by Luigi Pirandello. The selection of text for Italian is quite limited but you can find some of the most important authors. The main problem for a language teacher is that texts are free 70 years after the death of the author, so they use a language that is not always close to the one used today. They are a great source for literature courses. I did not investigate it deeply but it looks like Project Gutenberg is connected to wikipedia. Nonetheless, in wikipedia it is possible to find more works than in Project Gutenberg.
For Open Textbook unfortunately I have to bring comments on the same note. While I am sure it is a very valuable source for a lot of instructors in many disciplines, I could only find a textbook for Chinese in the language section. What is very valuable is the incredible amount of links to other websites to the right! It would take forever to check all of them but in the meantime I found a wikibook with an Italian course that I could use in my course. No animations, but some nice pictures. I will keep looking...(http://en.wikibooks.org/wiki/Italian).
What got me really excited is MERLOT. Not only because of the reference to the wine, but the Multimedia Educational Resources for Learning and Online Teaching is awesome. Unfortunately here too, I could not find anything I can use in class for Italian (there are only some very good lessons about the Divine Comedy posted by Yale), but the resources for Spanish are interesting and generally speaking the amount of articles about online teaching is huge.