Q: Is there a way to have a song in a playlist but not in the library?
– TJenkevff
A: No, each playlist is a subset of your library; every song must be in the library, but no songs have to be in any playlists.
With this in mind, remember that playlists are merely pointers to songs, so a song can be in several playlists, yet only be in the library once.
Kirk McElhearn is the author of several books including iPod & iTunes Garage.