Litecoin fees can be kinda steep. I patched mine to allow transactions with lower fees (all the way down to zero, if you want). In your Litecoin source-code tree, load src/main.h and search for this line:
static const int64 MIN_TX_FEE = 10000000;
Change the minimum to zero and recompile. Use the settxfee API call (or the appropriate options in the Qt client) to set the fee you want to use. If you're using Gentoo, you can use my litecoind and/or litecoin-qt ebuilds (part of my
overlay); include the nofee USE flag to apply the patch.
Warning: Transactions may take longer to confirm if you do this. I've had some take a day or so to get through.
I tried that it worked well, thanks for the tip. I didn't set it to zero, just way less than it was (same as bitcoin), so a more practical transaction fee still gets paid, and my test transfers went though quickly.