A complicating factor is that the EZ Reader (and almost all other Hanlin V3s) are about to switch from MOBI DRM (encryption) to Adobe ePub and PDF DRM, see
Adobe Digital Editions for EZ Reader. This means that, if you upgrade to the new firmware (once it is available), the MOBI reader will be diferent. It obviously won't read DRMed MOBI ebooks, but it will also be a 3rd party reader which will probably be about as good as the current LIT reader.
A format that will stay the same is FB2, which works well on the EZ Reader. The
calibre 0.6 beta can convert DRM-free ebooks from many formats to many formats, and it supports FB2. Since Calibre makes it easy to format shift, you could instead convert LIT to MOBI now and to ePub later when the firmware switches over.