When I purchased my KT in July 2011 I inserted a MicroSD card and everything worked fine. It continued to work with no problems until 1.9.11 and then it rendered my KT unusuable.
1) Dane Elec MicroSD 2GB
2) Any/all books cause the same problem if the card is loaded into the KT
3) I use all three ways (never at the same time). Without the SD card the KT works fine. With it the problems occur to any and all books (including ones loaded into the internal memory).
4) Problems started with 1.9.11 and continue with 1.9.12. I had no problems with 1.9.10 and earlier.
5) After turning the pages of the book (any book) a few times the book closes and goes back to the main screen and the sd card books disappear from the library.
Yes, it is an old MicroSd card but it worked fine until 1.9.11. I am waiting on some new cards to try them out and see if the same things happen.