I too have been looking into how this can be done (playing Real audio streams in real time). Poking around I see that there are several Real audio plugins for things like WinAmp etc. These require the real audio player to be installed but well, ok.

With this one should be able to code up a server side which advertises a playlist and when the content is requested, it sucks the real audio and converts to something the receiver can play.

I'd like to do this on linux using jreceiver. Ideally the output format would be as simple as possible (e.g., WAV).