To bump this topic up.
I've got my 4GB SD (non SDHC) card back (I've lend it out to use in a camera on a holiday trip) and I can confirm that a non-SDHC 4GB card can be used FULLY with the PRS505. I've thrown in 3.7GB worth of manga in it and can read them.
(and if
formatted to fat, it's really fast too )