As a side note. For anyone out there that wants to delve a little deeper into the inner workings of your iPhone. You can always SSH your books directly into the eReader app. You will need to jailbreak phone, but with surprisingly small amount of effort I was able to drop a few books over in eReader format.
All the files within the app are signed however, and you may have to do a little tweaking to get things to work just right.
But as mentioned above, a new version is in the works.