I actually like Sony's formatting. It's neat and clean. Many I find have errors or lack spaces in the right spaces. I downloaded one set of Tom Clancy novels that had the spaces between scenes completely removed. Made reading a bit difficult.
I downloaded a bunch of classics when I got my PRS-505. A lot of things I wouldn't normally go out and buy (even though I generally like classics). So far I've read Turn of the Screw (loved it, and now I want to read more Henry James) and The Pathfinder by James Fenimore Cooper (I love the Leatherstocking series). I don't see any problem with Sony formatting.