I don't know much about the theory-theory/mind-reading literature, but this study seems pretty interesting.
From: SCIENCE VOL 303 20 FEBRUARY 2004 (p.1121)
Researcher Tania Singer of the Institute of Neurology at University College London, U.K., and her team set up an experiment using 16 couples who were romantically involved and presumed to be acutely sensitive to each other’s pain. Keeping both partners in the same room, they put the female in a magnetic resonance imaging machine and watched her brain while a 1-second electric shock was delivered to the back of either her hand or her partner’s. She could not see his face but could see from an indicator which one of them was going to be zapped and whether it would be a weak shock or a sharp, stinging one. When the woman received sharp shocks, well-known pain regions in the limbic system were activated, including the anterior cingulate cortex, the insula (which is involved in relaying information from the cortex), the thalamus, and the somatosensory cortices, which relay the physical nature and location of the pain. Many of the same regions were activated in subjects when their partners got the painful shock. But empathy alone failed to activate the somatosensory cortices, for instance. The fact that the same affective brain areas respond to both experienced and imagined pain, claims Singer, is the root of empathy