For those seeing this for the first time:
We got a response from Sony on this issue. They're offering a $100 trade in credit on the PRS-500. There won't be an update.
I just got a response from Valerie Motis about updating the PRS-500. What had been previously conveyed was that the update is still under consideration. She reiterated this, and added something more. She said
We were still investigating feasibility and customer demand for a 500 upgrade.
Let's take her at her word. She wants customer demand, let's give it to her.
I can think of two ways we can politely pressure Sony into doing the update. (If you know of another way to raise the issue, feel free to suggest it.)
1. Send an email to the Sony Reader tech support, and ask about status of the update for the 500. Click here
2. Call the 800 number for Sony Reader tech support, and ask about status of the update for the 500. 1-866-962-7669
One final note: Please do not spam Sony tech support. I want this to be an honest effort to overwhelm Sony with requests for the update.