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Actually kepub is still distinct from ePUB. See the wiki for details. A kepub file is stored similar to an ePub file that has been expanded but if you were to copy it from a device you would not be able to read it on other devices. It is used in conjunction with a database to provide extra functionality. When you buy a book from the Kobo site it can generally be downloaded in either ePUB or kepub (if you have a kobo device). A kobo device can read a regular ePub file but some of the special Kobo features will not work on that book.
Dale
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