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I might be wrong, but I think if you decrypt a legitimately bought .LIT file for your personal use only, in order to be able to read it on your device, then the fair use principle applies.
In general, there is no need to have a Pocket PC for unlocking .LIT files... there are binaries of the required tool available for both Windows and Mac... you get back HTML files which you can then use with your favorite e-book conversion tool (such as iSiloX for iSilo or Sunrise for Plucker).
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