Finally figured out the best way to manage all my music between iTunes, the iPad, iPod Nano, and iPhone.
1. Make a Playlist called iPhone and add all the songs that are supposed to me on the iPhone to it.
2. Make smart playlists using the requirement they match that iPhone playlist as the first rule.
3. Uncheck manually manage music and auto-sync the iPhone playlist and all smart playlist to the iPhone.
4. Uncheck manually manage music and auto-sync all the smart playlist to the iPad and iPod Nano.
This allows one to manually manage what's on the iPhone without having it sync to your entire library by simply editing the iPhone playlist and it also syncs all metadata between iTunes, the iPad, iPhone, and iPod Nano. It creates a seamless listening experience on every device where they all have the same basic playlist with matching ratings and metadata. You can also export the iPhone playlist then import it in the event of a restore and get your music back exactly how it was on the device.