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As for reading, there is little if any difference between 4 or 8 levels.
As for reliability, both are excellent as long as the screen is not broken. There was a bit of a problem on the prior Sony model but I have heard of very few on the 505. I have heard of even less problems with the Cybook Gen3.
While there are stories afoot that Sony will add dictionary support to the 505, don't buy on that. Since a dictionary is important for you, go with the Gen3. Mobipocket is a wider supported format than the Sony LRF.
While either will serve you well for reading, only the Gen3 will provide the dictionary support you want. If there is anything we can do to help, just ask. Keep us posted about your progress.
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