I was indeed referring to the TOC in the Sony UI.
So far, I'm understanding that nested (UI) TOCs can only be done in PDF, but if it is a feature of the Sony UI, couldn't it be invoked by other formats. My question still is: what makes pdfs work that way and nothing else can?
2nd question: is it possible to build a nested TOC pdf document just to navigate the contents and then have it link into another book (possibly in lrf format) within the reader? ----I kinda figured this one is a long shot, but worth asking.