Just saw this via Teleread this morning. Looks like it will do the job until Overdrive's app comes out (maybe in December?).
http://mobiputing.com/2010/11/how-to...-on-an-iphone/
http://blog.libraryjournal.com/ljins...sync-required/
The first link is the original. The second link shows an alternative way of just emailing yourself the acsm file so that you don't have to rely on iTunes or bother with syncing.