MOBI and eReader both require Python scripts run from the command line to strip their DRM. LIT requires a C program which you can get as a pre-built binary for the command line, and under Windows there is a GUI (ConvertLIT GUI). Amazon's AZW format is MOBI, and can be made DRM-free with mobidedrm like most other MOBIs. However you can only currently buy from Amazon if you have a Kindle (there are reports that this will change soon), and some Amazon titles are in the TOPAZ format which, like Adobe PDF and ePub, is currently not strippable.
Secure LIT is only down-loadable using Windows Internet Explorer (i.e. you need a Windows PC), but it is the most feature rich of the formats and the most often recommended. MOBI and eReader are ok too, particularly if your current device supports the format and you want DRM-stripping capability for the future. With LIT the ebook is typically immediately format shifted to allow it to be read on your device, because relatively few devices support it directly.
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