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Steve (one of the Fictionwise owners) has commented on this a few times, and his comments are posted and linked in several posts already on these forums. Essentially, he admitted that, in response to many requests from the community, they wanted to have a functional reader available at launch, and went with a reduced feature set to make that happen. In the next few weeks (depending on Apple's approval process) they expect to release another version with more features, and a way to upload books converted at home or purchased from other stores to an online bookshelf and access them from the eReader software.
If you prefer not to wait, there are some options. I am told that Bookshelf (recommended above) is very nice, and a good deal at $10. If you are a mac user, you have a few more options. You can upload/read files using Stanza (did I hear there was a windows version coming?), which supports just about any unprotected format except eReader and I think it is free. Also, while not a dedicated ebook reader, there is File Magnet for $5 (also mac only), which reads a number of formats, and has received some good press.
Jack
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