I just wanted to add that I've since had a little time to try out orion on the Nook 1st edition. It's much better than I expected it to be, and supports four-way cropping, arbitrary and fit-to-dimension zooming, (relatively) convenient scrolling, and even configurable tabular ordering for scrolling through a page that fits in neither dimension.
I've only used it for a few hours, but it's definitely good enough for several of the books I'd loaded on my nook but given up on being able to read. The cropping feature is adequate, in that, so long as one's pages are mostly consistently framed, there is no need to pre-crop the book for reading. I have noticed, however, that some scanned books have somewhat fuzzy text regardless of magnification. This is probably a result of however the display chooses to display things that don't hit one of the 16 gray levels exactly. If so, I'm hoping it can be fixed with some sort of requantization/unsharping with imagemagick. Most books didn't have this problem, but I thought I'd mention it in case you have a lot of sortof-fuzzily scanned and poorly postprocessed PDFs, as I seem to.
Orion is even open source, so if it's an "almost" for you, you can probably fix it. It also supports djvu (though I haven't tested this) and cbz (which isn't really a use case for me). I think this may be close to as good as it gets until someone releases an affordable e-ink device with a larger screen.
Orion can be found here: