Do you have the Sony Library software installed? If you drag the book to either the Reader or your inserted SD card, it will format the book during the transfer.
If you put it on the SD card, then insert the card to Reader, it should already know it's formatted.
One word of...warning?...in my experience, about every other time I remove the card from the Reader and re-insert it, the books' formatting is no longer kept in memory. Books that read fine before will need to be formatted by the Reader again when I first open them.
I don't know why it "forgets" sometimes, but it does.
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