[IceHand]

I was able to get it running with Sun's Java Wireless Toolkit for CLDC (scroll down for the download link).
You have to change some configurations before it works:

1. Open Java Wireless Toolkit, select "File -> Create Project from JAD/JAR file" and open "MobipocketReader.jad". The message Project "MobipocketReader" loaded should appear in the window. Next time you can just click "Open Project" and select MobipocketReader from the list.
2. Select "Edit -> Preferences". Select Security and change the security policy to JTWI. You may also change the security domain to trusted, otherwise the emulator will ask for permission to read and write to the filesystem each time you start Mobipocket Reader. Then click OK.
3. Select Run and the Java phone emulator will be started. You have to use the phone buttons to navigate, so select "library" with the phone's select button.
4. You'll probably get the message that you have no e-books in your library, so close the emulator and navigate to ~/j2mewtk/2.5.2/appdb/DefaultColorPhone/filesystem/root1/eBooks. I don't know where the "j2mewtk" folder will be on Windows, but on Linux it's in the user's home directory. Just do a search. Put some Mobipocket e-books in this folder.

That's it. You can also select the phone's skin by choosing one of the four devices before starting the emulator (the combo box on the JWT main screen). Notice however that each device has it's own library and PID.

Attached are some screenshots.