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The IPAQ 3850 can be upgraded to windows mobile 2003, if it's not already running that OS. You may be able to find an upgrade by search through eBay.
If you already use Microsoft Reader and Adobe Reader, you are running the latest versions of those applications - there has not been many changes to the pocket pc versions of those software in a number of years - and you should be able to read DRM .Lit books on the device. DRM PDF books probably won't work since it seems that Adobe's pocket pc activation system is no longer operational.
But like Harry already mentioned, you should be able to install Mobipocket to your device and you should be able to read DRM Mobipocket books on it.
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