How to create an iphone ringtone with the new itunes?

How? I can't do it the itunes way as there's no 'create aac version' and you can't drag the clip into itunes anymore and basically i already have the song and i don't want to pay £1 for 30 seconds when i already have it.

I'm afraid this can't happen. You'll have to pay for the ringtone separately than the iTunes song itself.