Welcome to Mobileread!
"The Book" supports a wide variety of formats. I prefer epub myself, but other formats also work well. The big issue was the incompatibility of ebooks from B&N and the public library with the original version of the Adobe DRM that was included on the Augen e-reader. Updated firmware fixed the problem (which only affected DRM'ed ebooks).
The wifi is slow, and uses portrait mode only (480 pixels wide), so your best bet is to stick with websites optimized for mobile devices, which load faster and don't require a lot of scrolling.
Unless you're buying books from Augen's partner, eBooks Media, you can't directly download ebooks to the reader via wi-fi. Download them to your pc, then transfer DRM'ed books (epub or pdf) through the Adobe Digital Editions application, and other non-DRM'ed books by the drag 'n' drop method, or through Calibre.