I would of said the same thing until I heard Melodyne, there's a demonstration video on
www.celemony.com check out what it can do with those trumpet solos. Pretty damn amazing indeed.
I think with the looping thing, the difficulty is finding an point in the sample ( maybe in the middle with a case like this ) that will loop successfully. I guess it would need to play, then loop for a small time, then continue on for its natural release. With a small sample that's got to be nigh on impossible. The problem would be trying to find a loopable section in such a small area, too small and loop points would just make the sound bounce back and forth creating a new pitched 'buzzing' sound, that's providing you can actually get a loop point in the first place.
I use a tool called Seamless Looper, which is very good for identifying and creating loop points in audio files. It's not miracle worker though.
Personally, I'd download the demo of Melodyne, make loads of variants on the sample using the stretch function and record the output into a wave editor. ( The demo wont let you render stuff, but you can of course record what you have done ;-) )